TCR_Public/020808.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

            Thursday, August 8, 2002, Vol. 6, No. 156     

                          Headlines

360NETWORKS: Seeks Okay of Uniform Plan Voting Procedures
ANC RENTAL: Asks Court to Approve Bank of America Security Pact
AAVID THERMAL: Sells Stake in Thermalloy Holdings for Eur1.3MM
ADELPHIA BUSINESS: Look for Schedules & Statements on Sept. 9
ALLIED WASTE: Fitch Affirms Several Low-B Debt Ratings

AMERICAN COMMERCE: Must Raise New Funds to Continue Operations
AMKOR TECH: S&P Lowers Corporate Credit Rating to B from B+
AQUILA: Exiting Wholesale Energy Marketing and Trading Business
AVISTA CORP: Posts Improved Second Quarter Financial Performance
BCE INC: Commences Share Offering to Raise Up to $1.75 Billion

BUCKEYE TECHNOLOGIES: Posts Q4 Net Loss of $2.6M on $160M Sales
BUDGET GROUP: Wants to Obtain $434 Mill. Secondary DIP Facility
BURLINGTON: B.I. Transportation Wins Nod to Sell Gaston Terminal
COLUMBIA LABORATORIES: Selling 1M+ Shares to PharmBio for $5.5MM
COMDISCO: Panel Gets Okay to Withdraw Chaim Fortgang as Counsel

CONTINUCARE CORP: Has Until Year-End to Meet Nasdaq Requirements
CONVERSE INC: Exits Chapter 11 Bankruptcy Proceeding
CORNERSTONE PROPANE: Will Defer Publishing Fiscal Year Results
CORNERSTONE PROPANE: Fitch Downgrades Ratings to Default Level
CORNERSTONE: NYSE Halts Trading & Will Strike Shares from List

COX TECHNOLOGIES: Cherry Bekaert Raises Going Concern Doubt
DDI CORP: Fails to Maintain Nasdaq Continued Listing Standards
DT INDUSTRIES: Will Make Adjustments to Financial Statements
DADE BEHRING: Hires Jones Day as Recapitalization Claims Counsel
EASYLINK SERVICES: Working Capital Deficit Tops $14MM at June 30

ENRON CORP: SEC Has Until November 27, 2002 to File Claims
ENRON CORP: Gov't Entities Obtain Time Extension to File Claims
EPICEDGE: AMEX Accepts Plan to Meet Continued Listing Standards
EXOTICS.COM: Merdinger Fruchter Expresses Going Concern Doubt
FOCAL COMMS: Reports Improved Results for Second Quarter 2002

FRONTLINE COMMS: Second Quarter Net Loss Plummets 80% to $204K
FRUIT OF THE LOOM: Trust Signing up Keen Realty as Auctioneer
GLENOIT CORP: Wants Until Nov. 6 to Make Lease-Related Decisions
GLOBAL CROSSING: Implements Matrix Internet Performance System
GOLF AMERICA: Case Summary & 20 Largest Unsecured Creditors

HAYES LEMMERZ: Wants to Keep Exclusivity Until January 15, 2003
ICG COMMS: Asks Court to Approve Supplemental Plan Disclosure
ITC DELTACOM: Turns to Deloitte & Touche for Financial Advice
INACOM INC: Court Okays Werb & Sullivan as Avoidance Counsel
INTEGRATED HEALTH: Rotech Wants More Time to Challenge Claims

KAISER ALUMINUM: Gilbert Heintz Agrees to Revise Engagement Fees
KMART CORP: Court Okays Erwin Katz to Perform Mediation Services
KMART CORP: Gets Green Light to Sell Cessna Aircraft to Shamrock
KNOWLES ELECTRONICS: June 30 Balance Sheet Upside-Down by $485MM
LTV CORP: Nonprofit Group Acquires former Hazelwood Works Asset

LERNOUT & HAUSPIE: ScanSoft Proposes $6.8MM Buyback of Shares
LUCENT: S&P Places B+ Corp. Credit Rating on Watch Negative
METALS USA: Enters Pacts to Sell Assets of 3 Operations for $50M
NDC AUTOMATION: Must Seek New Financing to Meet Liquidity Needs
NATIONSRENT INC: Expects to Name New Permanent CEO Soon

NEON COMMS: U.S. Trustee Appoints Unsecured Creditors' Committee
NETIA HOLDINGS: Equity Deficit Reaches $207 Million at June 30
NETIA HOLDINGS: Sets Extraordinary General Meeting for August 30
NEWPOWER COMPANY: Bringing-In Sidley Austin as Attorneys
NOVATEL WIRELESS: Falls Below Nasdaq Continued Listing Standards

NUEVO ENERGY: June 30 Working Capital Deficit Reaches $17 Mill.
NUEVO ENERGY: Updates Third Quarter 2002 Financial Guidance
OGLEBAY NORTON: S&P Drops Corp. Credit & Bank Loan Ratings to B
ONVIA.COM INC: Regains Compliance with Nasdaq Listing Guidelines
PAC-WEST TELECOMM: Second Quarter EBITDA Drops 18.6% to $8.3MM

PACIFIC GAS: IRS Confirms Tax-Free Reorganization Transactions
PERSONNEL GROUP: Affiliate's Name Changed to Venturi Staffing
PHOTOCHANNEL NETWORKS: Raises $850,000 through Private Placement
PREVIO INC: Files Prelim. Dissolution Proxy Statement with SEC
PUEBLO XTRA: S&P Assigns D Rating after Interest Non-Payment

REPEATER TECHNOLOGIES: Nasdaq Will Delist Shares by August 13
TYCO INT'L: Names Eric Pillmore as Sr. VP - Corporate Governance
TYCO INTL: Appoints Ex-Dupont CEO/Chairman John Krol to Board
TYCO INTL: Nixes Proxy Statement Proposing Board Size Increase
W.R. GRACE: Has Until January 10, 2003 to Remove Pending Actions

WHOLE LIVING: Appoints Robert Thele as Company Senior Executive
WILLIAMS CONTROLS: Nixes Anti-Takeover Provisions from Charter
WORLDCOM INC: Wants to Honor & Pay Prepetition Sales & Use Taxes

* DebtTraders' Real-Time Bond Pricing

                          *********

360NETWORKS: Seeks Okay of Uniform Plan Voting Procedures
---------------------------------------------------------
360networks inc., and its debtor-affiliates ask the Court to
establish voting uniform procedures and approve customized
ballot forms for voting on their plan.

Alan J. Lipkin, Esq., at Willkie Farr & Gallagher, in New York,
relates that the proposed procedures would enable voting and
vote tabulation to proceed fairly and orderly.

The Debtors propose that each claim against the Debtors shall be
allowed for purposes of voting on the Plan only, in accordance
with these rules:

  (i) Undisputed Scheduled Claims.  For a Claim that appears on
      the Debtors' Schedules as undisputed, noncontingent, and
      liquidated, and no objection has been filed at least 10
      days prior to the end of the Voting Period, the amount
      and classification of the Claim shall be that specified
      in the Schedules;

(ii) Undisputed Filed Claims.  For a liquidated, non-contingent
      Claim as to which a proof of claim has been timely filed
      and no objection has been filed at least 10 days prior to
      the end of the period fixed by the Court for voting on
      the Plan, the amount and classification of the Claim
      shall be that specified in the proof of claim as
      reflected in the records of Bankruptcy Services, LLC, the
      Balloting Agent, as agent for the Clerk of the Court
      subject to any applicable limitations;

(iii) Disputed Filed Claims.  For a Claim that is the subject
      of an objection filed at least 10 days prior to the end
      of the Voting Period, the Claim will be disallowed
      provisionally for voting purposes, except to the extent
      and in the manner that:

        (a) the Debtors agree the Claim should be allowed in the
            Debtors' objection to the Claim; or

        (b) the Claim is allowed temporarily for voting purposes
            in accordance with Bankruptcy Rule 3018;

(iv) Claims Estimated for Voting Purposes.  For a Claim that
      has been estimated or allowed for voting purposes by
      order of the Court, the amount and classification of the
      Claim will be that set by the Court;

  (v) Wholly Unliquidated Claims.  For a Claim recorded in the
      Debtors' Schedules of Assets and Liabilities filed with
      the Court or in the Clerk's records as wholly
      unliquidated, contingent or undetermined will be accorded
      one vote valued at $1 for purposes of Section 1126(c) of
      the Bankruptcy Code, unless the Claim is disputed;

(vi) Partially Unliquidated Claims.  For a Claim that is
      unliquidated, contingent or undetermined in part, the
      holder of the Claim will be entitled to vote that portion
      of the Claim that is liquidated, non-contingent and
      undisputed in the liquidated, non-contingent and
      undisputed amount, subject to any limitations and unless
      ordered by the Court;

(vii) Late Claims.  For a Claim as to which a proof of claim
      was not timely filed, the voting amount of the Claim will
      be equal to:

      (a) the amount listed in the Schedules, to the extent the
          Claim is not listed as contingent, unliquidated,
          undetermined or disputed; or

      (b) if not so listed, then the Claim will be disallowed
          provisionally for voting purposes;

(viii) Claims Limited to Setoffs.  For a Claim whose holder has
      agreed that the Claim may be asserted solely for purposes
      of setoff against claims the Debtors may have against the
      holder and not as an affirmative Claim against the
      Debtors' estates, the Claim will be disallowed
      provisionally for voting purposes; and

(ix) Duplicate Claims.  A creditor will not be entitled to vote
      its Claim to the extent the Claim duplicates or has been
      superseded by another Claim of the creditor.

According to Mr. Lipkin, the Debtors propose to promptly give
notice to holders of Claims that are wholly unliquidated,
contingent or undetermined, of the one dollar, one vote
procedure, to be served upon claimants by first class mail by
the later of:

    (i) five business days after the entry of an order
        establishing voting procedures; and

   (ii) the deadline for transmitting the Plan, Disclosure
        Statement, and ballots to creditors voting on the Plan.

Any claimant wishing to challenge the valuation must file and
serve on counsel for the Debtors within 10 days of notice's
service, a motion for a hearing on the estimation of the claim
for voting purposes.

Mr. Lipkin tells the Court that a Creditor's Voting Motion must
specify the amount and classification that the claimant believes
its Claim should be entitled for voting purposes and provide
evidence in support of that belief.  Furthermore, the Debtors
request that if this Court has not temporarily allowed all or a
portion of the Claim for voting purposes by the Voting Deadline,
then the Claim should not be counted for voting purposes.  If a
claimant reaches an agreement with the Debtors as to the amount
and classification of their Claim for voting purposes, then a
stipulation setting forth that agreement may be presented to the
Court for approval by notice of proposed stipulation and order.
Presentment shall be upon three business days' notice to all
parties requesting notice in the Debtors' Chapter 11 cases.

The Debtors also seek the Court's approval of the use of their
proposed ballots to be distributed to the holders of impaired
claims that are entitled to vote on the Plan -- specifically,
ballots for Class 4, Pre-petition Lender Claims; ballots for
Class 5, Nonconsensual Lien Claims; ballots for Impaired Class 6
Claims or other secured claims; and ballots for Class 7, General
Unsecured Claims.

The Debtors further ask the Court to approve these rules,
standards and protocols for the tabulation of ballots:

  (i) for the purpose of voting on the Plan, BSI, as balloting
      agent, will be deemed to be in constructive receipt of any
      ballot timely delivered to any address that BSI designates
      for the receipt of ballots cast on the Plan;

(ii) any ballot received by BSI after the end of the Voting
      Period shall not be counted;

(iii) whenever a holder of a Claim submits more than one ballot
      voting for the same claim prior to the end of the Voting
      Period, the first ballot sent and received shall count
      unless the holder has sufficient cause to submit, or the
      Debtors consent to the submission of, a superseding
      ballot;

(iv) if a holder of a Claim casts simultaneous duplicative
      ballots voted inconsistently, then the ballots shall be
      counted as one vote accepting the Plan;

  (v) the authority of the signatory of each ballot to complete
      and execute the ballot shall be presumed;

(vi) any ballot not signed shall not be counted;

(vii) any ballot received by BSI by telecopier, facsimile or
      other electronic communication shall not be counted;

(viii) a holder of a Claim must vote all of its Claims within a
      particular class under the Plan either to accept or reject
      the Plan and may not split its vote.  Accordingly, a
      ballot, or multiple ballots with respect to separate
      Claims within a single class, that partially rejects and
      partially accepts the Plan, or that indicates both a vote
      for and against the Plan, will not be counted; and

(ix) any ballot that is timely received and executed but does
      not indicate whether the holder of the relevant Claim is
      voting for or against the Plan shall be counted as a vote
      for the Plan.

The Debtors also intend to have BSI continue serving them as
balloting agent with respect to the Plan voting solicitation.
BSI may perform all services relating to the solicitation of
votes on the Plan, like:

    (i) printing and mailing the notice of hearing to consider
        confirmation of the Plan;

   (ii) coordinating the design and printing of ballots;

  (iii) identifying voting and non-voting creditors and equity
        security holders;

   (iv) preparing voting reports by Plan class and voting amount
        as well as maintaining all information in a BSI
        database;

    (v) printing ballots specific to each creditor, indicating
        voting class under the Plan, voting amount of claim and
        other relevant information;

   (vi) coordinating the mailing of ballots and providing an
        affidavit verifying the mailing of ballots;

  (vii) receiving ballots and tabulating and certifying the
        votes on the Plan; and

(viii) providing any other balloting related services as the
       Debtors may from time to time request including providing
       testimony at the confirmation hearing with respect to the
       Balloting Services and the results of the vote on the
       Plan.

The Supreme Court of British Columbia in Canada has established
August 12, 2002 as the voting record date for the Canadian
Applicants.  Thus, the Debtors ask the Bankruptcy Court to
establish August 12, 2002 at 5:00 p.m., prevailing Eastern Time
as the record date for determining which holders of claims
against the U.S. Debtors are entitled to vote to accept or
reject the Plan.

In addition, the Debtors intend to serve notice to all holders
of:

    (i) unpaid prepetition claims that are unimpaired under the
        Plan; and

   (ii) claims and interests that is deemed to have rejected the
        Plan by virtue of receiving no distributions.

The Debtors also intend to serve all holders of impaired claims
and interests with copies of the Plan, the Disclosure Statement
and all exhibits, the order approving the Disclosure Statement,
and the relevant ballots.  The Debtors seek the Court's approval
that the forms of ballots and notices are due and sufficient
under Bankruptcy Rule 3017(d). (360 Bankruptcy News, Issue No.
29; Bankruptcy Creditors' Service, Inc., 609/392-0900)   


ANC RENTAL: Asks Court to Approve Bank of America Security Pact
---------------------------------------------------------------
All of ANC Rental Corporation and its debtor-affiilates' cash is
consolidated in an investment account maintained by ANC
Financial LP with Bank of America.  Each of the operating
subsidiaries, i.e., National Car Rental System Inc., Alamo Rent-
A-Car LLC and Spirit Rent-A-Car Inc. d/b/a Alamo, has its own
master account in which funds are automatically transferred to
and from ANC Financial LP.

By this motion, the Debtors seek the Court's permission to enter
into a Security Agreement with the Bank of America.  According
to Mark J. Packel, Esq., at Blank Rome Comisky & McCauley LLP,
in Wilmington, Delaware, Bank of America refuses to provide the
Debtors with the Automated Clearing House network until the
Court approves the Security Agreement.  The Debtors have
historically used the ACH network to transfer funds between ANC
and its subsidiaries.

Mr. Packel explains that the Debtors want to retain the ACH
rather than wire transfer the funds.  ACH is a secured funds
transfer system that connects all U.S. financial institutions.
Unlike a wire transfer, which transfers funds directly between
banks on the same day, the ACH network acts as a central
clearing facility for transfers that are usually credited a day
later. Besides, Mr. Packel notes, each wire transfer costs $8
per transaction while ACH transfers cost only $0.75 per
transaction.

Mr. Packel informs the Court that the Debtors' previous
agreement with the First Union National Bank on ACH services was
terminated by First Union on June 7, 2002.  Thus, the Debtors no
longer have the ability to employ the ACH method of moving funds
from numerous local depository accounts to corporate level
accounts. Fortunately, the Bank of America has agreed to offer
ACH services to the Debtors.

The Security Agreement requires the Debtors to establish a
$1,000,000 deposit account with Bank of America.  The amount
will secure any of the Debtors' obligations with respect to the
banking services provided by Bank of America.  Bank of America
has allowed the Debtors to utilize ACH services during the
interim period prior to the hearing on this Motion.

Mr. Packel asserts that this Motion should be approved to
preserve the Debtors existing cash management system.  "If the
Debtors are forced to utilize wire transfers, the Debtors would
have to restructure their cash management system to provide for
intercompany wires and add staff to deal with the administrative
burdens associated with that system," Mr. Packel explains.  The
Debtors would also be forced to sacrifice significant management
time and efforts that otherwise would have been spent in
reorganizing the Debtors' business, Mr. Packel adds.  The
Debtors estimate that the changes to their cash management
system would result in over $400,000 additional expenses
annually.

Mr. Packel assures the Court that the Creditors' Committee
supports the Debtors' motion. (ANC Rental Bankruptcy News, Issue
No. 17; Bankruptcy Creditors' Service, Inc., 609/392-0900)


AAVID THERMAL: Sells Stake in Thermalloy Holdings for Eur1.3MM
--------------------------------------------------------------
On July 17, 2002, Aavid Thermal Technologies, Inc., sold all of
the outstanding shares of Aavid Thermalloy Holdings, GmbH, which
in turn owned approximately 89.5% of the outstanding shares of
curamik electronics GmbH, pursuant to a Share Sale and Purchase
Agreement between the Company and Electrovac Fabrikation
Electrotechnischer Spezialartikel GesmbH dated July 10, 2002.
Under the Sale Agreement, the Company received consideration of
EURO31,290,000, subject to possible adjustment based upon
consolidated net assets of curamik and certain indemnification
obligations of the Company.

Aavid Thermal Technologies, Inc., is a leading provider of
thermal management solutions for dissipating potentially
damaging heat from digital and industrial electronics, and
computational fluid dynamics software, which permits computer
modeling and flow analysis of products and processes that would
otherwise require time-consuming and expensive physical models
and the facilities to test them.

As previously reported, Aavid Thermal's March 31, 2002 balance
sheet shows a total shareholders' equity deficit of about $48.6
million.


ADELPHIA BUSINESS: Look for Schedules & Statements on Sept. 9
-------------------------------------------------------------
Adelphia Business Solutions, Inc., and its debtor-affiliates ask
the Court to further extend by 45 days, through and including
September 9, 2002, the time within which to prepare and file
their Schedules.

According to Harvey R. Miller, Esq., at Weil Gotshal & Manges
LLP, in New York, the ABIZ Debtors provide telecommunications
services nationwide directly to thousands of customers, who, in
turn, provide the ABIZ Debtors' services to their direct
customers.  These services are governed by a multitude of
agreements affecting all kinds of assets and equipment located
in different regional locations.  The process of identifying all
executory contracts and leases, and all potential claimants is a
formidable one, but necessary to ensure that all creditors are
notified of important developments in these Chapter 11 cases.  
In order to prepare the Schedules, the ABIZ Debtors have sought
to gather extensive information related to their operations,
services, and customers throughout the country.  That task has
required an enormous expenditure of time and effort on the part
of the ABIZ Debtors and their employees, and has been
intensified by the ACOM Debtors' Chapter 11 filings.

Mr. Miller relates that the Debtors' management has expended
substantial efforts responding to the many emergencies and other
matters that are incident to the commencement of any chapter 11
case, but which are compounded by the size and complexity of
these cases.  The Debtors have had to:

    -- respond to requests for adequate assurance,

    -- respond to motions seeking to compel the Debtors to
       assume or reject executory contracts,

    -- respond to a motion seeking to cancel or terminate
       substantially all of the Debtors' surety bonds,

    -- identify for sale assets that are no longer economically
       beneficial to the estates,

    -- identify leases for rejection to conserve administrative
       costs,

    -- maintain current services necessary to the operation of
       their businesses,

    -- conduct meetings with numerous vendors with respect to
       continuing prepetition business relationships, and

    -- meet with the major creditor constituencies in these
       cases to keep them apprised of major developments.

Mr. Miller admits that the Debtors' ability to confront the
various emergencies incidental to their Chapter 11 cases has
been adversely affected as a result of a significant workforce
reduction since the Petition Date, which has been necessitated
by the Debtors' revised business plan.  The loyal employees who
remain have had to shoulder the extra demands of the Chapter 11
process and a streamlined workforce, and are working tirelessly
to meet all of the requirements imposed by the Chapter 11
process to the best of their abilities.  Accordingly, in view of
the size of the Debtors' cases, the amount of information that
must be assembled and compiled, the location of the pertinent
information, and the significant amount of employee time that
must be devoted to the task of completing the 16 separate
Schedules and Statements, the Debtors assert that ample cause
exists for an extension to file their Schedules.

The Court will convene a hearing today, August 8, 2002, to
consider ABIZ's third request for additional time and the
current deadline is extended through the conclusion of that
hearing. (Adelphia Bankruptcy News, Issue No. 12; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


ALLIED WASTE: Fitch Affirms Several Low-B Debt Ratings
------------------------------------------------------
Fitch Ratings has affirmed the following ratings of Allied Waste
Industries, Inc., (NYSE:AW) and revised the Rating Outlook to
Negative from Stable.

                   Allied Waste North America
     
     -- $1.3 billion Senior Secured Credit Facility 'BB';

     -- $2.9 billion Tranche A,B,C Loan Facilities 'BB';

     -- $3.1 billion Senior Secured Notes 'BB-';

     -- $2.0 billion Senior Subordinated Notes 'B'.

                Browning Ferris Industries (BFI)

-- $741 million Senior Secured Notes, Debentures and MTNs 'BB-'.

The revised Rating Outlook reflects the adverse effect that the
weak economy has had on AW's ability to increase prices in
certain business segments, pressuring margins and free cash flow
generation. Competitive pricing in the industrial and
construction roll off segments has led to negative year over
year pricing for the last couple of quarters and there are no
indications of near term improvement. AW has been unable to
achieve price increases sufficient to offset higher costs,
especially insurance and health related expenses. As a result,
EBITDA expectations continue to moderate and free cash flow with
which to reduce debt will be lower than Fitch had originally
expected. Although the pace of debt reduction has moderated, the
company should remain cash flow positive even under slightly
further reduced economic conditions.

Credit statistics at year-end should show slight deterioration
from levels at Dec. 31, 2001, which were weak for the rating
category. Further meaningful reductions in EBITDA could result
in AW bumping up against its minimum interest coverage covenant
of 2.0 times. Positively, AW's liquidity remained solid at June
30, 2002 with $700 million in availability under the company's
revolver and approximately $27 million in debt maturing in 2002
and $314 million in 2003.

Current ratings reflect the company's geographically diverse
asset base, market density, and industry leading EBITDA margins.
Also incorporated into the ratings are the relatively low risk
profile of the waste industry and pricing strength relative to
most economically exposed industries. Offsetting factors include
AW's very high leverage position, which leaves AW with reduced
flexibility during times of economic weakness.


AMERICAN COMMERCE: Must Raise New Funds to Continue Operations
--------------------------------------------------------------
American Commerce Solutions, Inc., was incorporated in Rhode
Island in 1991 under the name Jaque Dubois, Inc., and was re-
incorporated in Delaware in 1994.  In July 1995, the Company's
name was changed to JD American Workwear, Inc.  In December 2001
the shareholders voted at the annual shareholders' meeting to
change the name of the Company to American Commerce Solutions,
Inc.  The Company is primarily a holding company whose wholly
owned subsidiary is engaged in the machining and fabrication of
parts used in industry and parts sales and service for heavy
construction equipment.

The Company has incurred substantial operating losses since
inception.  The Company recorded losses from operations of
$469,671 and $485,514 for the three-month periods ended May 31,
2002 and 2001,  as restated, respectively. Current liabilities
exceed current assets by $2,346,759 at May 31, 2002.
Additionally, the Company has been unable to meet obligations to
its creditors as they have become due.  These conditions raise
substantial doubt about the Company's ability to continue as a
going concern.

Management has revised its business strategy to include
expansion into other lines of business through the acquisition
of other companies in exchange for the Company's stock.
Management is currently negotiating new debt financing, the
proceeds from which would be used to settle outstanding debts at
more favorable terms, to finance operations and to complete
additional business acquisitions.  Subsequent to May 31, 2002,
the Company has an agreement with a lender that has agreed to a
lump sum offer in the amount of $551,283 in settlement of
approximately $1.3 million, subject to SBA approval.

However, there can be no assurance that the Company will be able
to raise capital, obtain debt financing or improve operating
results sufficiently to continue as a going concern.


AMKOR TECH: S&P Lowers Corporate Credit Rating to B from B+
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
and senior unsecured debt ratings on Amkor Technology Inc. to
single-'B' from single-'B'-plus. At the same time, the senior
secured bank loan rating was lowered to single-'B'-plus from
double-'B'-minus.

Standard & Poor's Ratings Services also lowered its ratings on
the West Chester, Pennsylvania-based company's convertible and
senior subordinated notes to triple-'C'-plus from single-'B'-
minus. The outlook is stable.

The ratings changes reflect volatile conditions in the
semiconductor market and a sustained deterioration in
profitability and debt-protection measures, offset by Amkor's
adequate near-term liquidity.

While Amkor, the largest provider of outsourced packaging and
testing services to semiconductor makers, has retained its
leading market share among independent providers, it is not
expected to materially outperform the semiconductor packaging
segment overall, which has suffered from a protracted period of
overcapacity.

"While Standard & Poor's view of the long-term outsourcing trend
in semiconductor packaging remains positive, we believe that
sequential improvements in demand are expected to be modest over
the near term," said Standard & Poor's credit analyst Emile
Courtney.

Amkor has recently made a number of joint venture and other
investments to increase its packaging presence in Japan, Taiwan,
and China, where it sees growth opportunities. As a result, the
company's high cost structure, manufacturing intensity, and
underutilized capacity are expected to delay its attempts to
materially improve profitability and cash flow measures.

Amkor's bank loan is rated one notch higher than its corporate
credit rating. Standard & Poor's is reasonably confident in the
prospects for full recovery of principal for secured bank
lenders over unsecured debt holders in the event of default or
bankruptcy. The bank loan package is contractually senior to all
other debt issues and includes $98 million in secured term loans
and a $100 million secured revolving line of credit.


AQUILA: Exiting Wholesale Energy Marketing and Trading Business
---------------------------------------------------------------
Aquila, Inc. (NYSE: ILA), is exiting the wholesale energy
marketing and trading business operated by its Aquila Merchant
Services subsidiary by the end of the third quarter. Since
announcing plans on June 17 to reduce its risk exposure and
restructure the business, Aquila has eliminated all market-
making activity and speculative trading, commonly referred to as
"proprietary trading." The elimination of this activity has
resulted in an approximately 90 percent reduction in physical
throughput.

As a part of the restructuring process, Aquila has worked with
The Blackstone Group during the past several weeks to explore
its strategic exit options.

"While we had explored the idea of securing a partner, we
believe it is in the best interest of our shareholders to
completely exit the wholesale energy marketing and trading
business," said Robert K. Green, president and chief executive
officer of Aquila. "Our focus now is to ensure a coordinated and
seamless exit."

As a result of Tuesday's announcement, Aquila Merchant Services'
North American and European workforce of approximately 500 will
be significantly reduced. Since May, about 550 positions have
been eliminated across all merchant operations.

In conjunction with its exit strategy, Aquila has reached an
agreement with Chicago-based Citadel Investment Group to provide
potential career opportunities with the investment firm for
those Aquila employees directly impacted.

"Our wholesale energy marketing and trading business is operated
by some of the best talent in the industry, and they have
created considerable value for Aquila in the past decade," said
Green. "Their skills and experience have played a major role in
our growth.

"The process of taking this business from a top-five energy
marketer to a complete exit of trading has required tremendous
effort and that reflects well of the professionalism and
commitment of Aquila's people."

Following the late-September shutdown of the energy trading
business, Capacity Services, which manages Aquila's non-utility
assets, will only market energy from the assets the company owns
or controls.

Based in Kansas City, Missouri, Aquila operates electricity and
natural gas distribution networks serving more than six million
customers in seven states and in Canada, the United Kingdom, New
Zealand and Australia. The company also owns and operates power
generation and mid-stream natural gas assets. At March 31, 2002,
Aquila had total assets of $12.3 billion. More information is
available at http://www.aquila.com


AVISTA CORP: Posts Improved Second Quarter Financial Performance
----------------------------------------------------------------
Avista Corp. (NYSE: AVA), reported second-quarter 2002
consolidated revenues of $751.4 million and net income available
for common stock of $12.1 million, exceeding consensus estimates
for the quarter.  For the equivalent quarter last year, Avista
reported revenues of $1.5 billion and net income available for
common stock of $22.1 million.

Avista Corp. Chairman, President and Chief Executive Officer
Gary G. Ely said, "During the quarter, Avista's dedicated
employees delivered results that surpassed consensus estimates.  
We successfully resolved all issues related to the Washington
electric rate case in our utility and implemented additional
efficiencies in our subsidiaries that will contribute to
improved results going forward.  While we have made progress,
including reducing debt by nearly $190 million to date, we will
not lose sight of the need to further enhance performance and
consistency on an ongoing basis despite the uncertainties
affecting the energy industry and the overall economy."

                       Avista Utilities

In May, Avista and three other parties reached an all-party
settlement agreement resolving all remaining issues in the
company's electric rate case in Washington.  The agreement was
approved by the Washington Utilities and Transportation
Commission and went into effect July 1, 2002, four months
earlier than originally expected.

The WUTC order included an energy recovery mechanism to allow
Avista to adjust electric rates up or down over time to reflect
changes in power-supply-related costs.  Under the ERM, Avista
will absorb or benefit from the first $9 million annually of
energy cost differences above or below the amount included in
base retail rates.  In 2002, this amount will be prorated for
the balance of the year.  Ninety percent of the energy cost
differences exceeding the initial $9 million will be deferred
for later rebate or surcharge to customers, while the remaining
10 percent will be an expense of or benefit to the company.  In
addition, certain measures have been extended to lessen the
impact of prior rate increases on customers.

"The electric rate case settlement, in combination with our
interim and prudence electric rate settlement allowing for
recovery of  $196 million, or 90 percent of power cost deferrals
over time, addresses the major regulatory issues in the state of
Washington," said Ely.  "Overall, we are making progress in
reducing deferred power and gas costs in Washington and Idaho.
During the first six months of 2002, Avista has been able to
decrease its total electric and gas deferral balances by $81
million."

During the second quarter, hydro-generation for Avista Utilities
was slightly above normal.  Above-normal snowpack, combined with
cooler-than-normal second-quarter temperatures helped extend the
run-off period for the Clark Fork and Spokane River systems.  
Based on current projections, streamflows for the year 2002 are
expected to be 110 percent of normal, and hydro-generation for
the year 2002 is expected to be 102 percent of normal.

Regarding governmental inquiries, Avista has responded to
initial and follow-up requests from the Federal Energy
Regulatory Commission regarding past and present wholesale
trading practices. Avista is fully cooperating with the FERC,
and the company's own investigations, including participation
from outside counsel, continue to show that Avista Utilities and
Avista Energy engage in sound business practices in accordance
with established market rules.

Avista Utilities and Avista Energy also are responding to a
subpoena from the U.S. Commodity Futures Trading Commission
related to "round-trip" trading practices.  As Avista indicated
in its previous FERC response, the company has not engaged in
such trading practices.

                    Energy Trading & Marketing

Avista Energy, the company's unregulated energy trading and
marketing business, has delivered strong, profitable performance
since mid-2000, and continues to deliver strong cash flow.

"At a time when the energy trading industry is undergoing
fundamental changes and some companies are radically restricting
or completely shutting down their energy trading and marketing
businesses, Avista Energy has provided sustained, positive
results," said Ely.  "Such consistent performance over the past
two years during challenging market conditions is attributed to
our strategy of focusing on the West, optimizing our asset-
backed marketing base, and benefiting from the expertise of our
Avista Energy team."

                    Information & Technology

Avista Advantage is making additional progress following its
management restructuring that was completed earlier this year.  
The facility information management subsidiary remains focused
on improving margins, reducing fixed and variable costs, and
growing revenue and client satisfaction.

During the first six months of 2002, Avista Advantage added 41
new clients and now provides facility information management
services to more than 250 nationally known clients representing
105,000 sites throughout the U.S. and Canada.  New clients
include American Eagle Outfitters, LaQuinta Hotels, Shell Oil,
24 Hour Fitness and others.

Avista Labs continues discussions with selected companies in its
search for a strategic partner while moving forward with product
development and market introductions.  Under an agreement with
Automated Railroad Maintenance Systems of St. Louis, three fuel
cells in Avista Labs' new "Independence" product line will be
distributed to the railroad industry for backup and remote power
applications. The Independence products include solutions for
100-watt to 4-kilowatt applications.

                   Outlook and Earnings Guidance

During the second-quarter, both Avista Corp., and Avista Energy
renewed their respective credit lines, further securing cash and
credit flexibility through the coming year.  Additionally,
Avista renewed and updated its long-standing receivables
financing program, which provides cost-effective, short-term
financing.

As previously announced, Avista has increased its consolidated
corporate earnings guidance for 2002 to the range of $0.70 to
$0.80 per diluted share, compared to previous estimates of
between $0.55 and $0.75 per diluted share. Based on current
projections, for 2003 Avista expects its consolidated earnings
to exceed $1.10 per diluted share.

Ely said, "Continued turmoil in the energy sector has frustrated
investors, analysts, industry participants and our customers.
Avista believes it is better positioned now to address these
challenges than at any time within the past couple of years.  As
a result of our disciplined approach to managing our operations,
the company expects to continue delivering meaningful
improvements in all of its business lines, absent any major
shifts in governmental or regulatory policy."

Avista Corp., is an energy company involved in the production,
transmission and distribution of energy as well as other energy-
related businesses.  Avista Utilities is a company operating
division that provides electric and natural gas service to
customers in four western states.  Avista's non-regulated
affiliates include Avista Advantage, Avista Energy and Avista
Labs.  Avista Corp.'s stock is traded under the ticker symbol
"AVA" and its Internet address is http://www.avistacorp.com  

                         *    *    *

As reported in the March 13, 2002 edition of Troubled Company
Reporter, Standard & Poor's affirmed Avista Corp.'s low-B
ratings due to the company's weakening financial profile.


BCE INC: Commences Share Offering to Raise Up to $1.75 Billion
--------------------------------------------------------------
BCE Inc. (TSX, NYSE: BCE), announced that further to its
August 1, 2002 shelf prospectus filing, it began on August 6, on
an overnight basis, a public offering of BCE common shares to
raise approximately $1.5 billion to $1.75 billion.

BCE also announced that as part of this offering, it has
received a lead order from a major North American investment
manager in the amount of $900 million at a price of $24.45 a
share which represents the public offering price.

The balance of the shares, with an over-allotment option, will
be offered in an overnight transaction through an underwriting
syndicate.

BCE has invited a syndicate of underwriters to place the common
share offering. RBC Dominion Securities Inc. will act as lead
manager and global bookrunner.

The net proceeds resulting from this offering will be used to
pay part of the acquisition price of SBC Communications Inc.'s
indirect minority interest in Bell Canada.

Common shares offered outside the United States to non-US
persons will not be registered under the US Securities Act. That
portion of the common shares to be sold in the United States or
in circumstances where registration of the common shares is
required has been registered under a registration statement
filed with the US Securities and Exchange Commission. A copy of
the prospectus and related prospectus supplement may be obtained
from RBC Dominion Securities Inc., One Place Ville Marie, Suite
300, Montreal, Quebec H3B 4R8.

BCE is Canada's largest communications company. It has 24
million customer connections through the wireline, wireless,
data/Internet and satellite services it provides, largely under
the Bell brand. BCE leverages those connections with extensive
content creation capabilities through Bell Globemedia which
features some of the strongest brands in the industry - CTV,
Canada's leading private broadcaster, The Globe and Mail,
Canada's National Newspaper and Sympatico-Lycos, the leading
Canadian Internet portal. As well, BCE has extensive e-commerce
capabilities provided under the BCE Emergis brand. BCE shares
are listed in Canada, the United States and Europe.


BUCKEYE TECHNOLOGIES: Posts Q4 Net Loss of $2.6M on $160M Sales
---------------------------------------------------------------
Buckeye Technologies Inc. (NYSE:BKI), announced that its net
sales for the quarter which ended June 30, 2002 were $160.1
million compared to $175.0 million in the same quarter of the
prior year.

During the quarter the Company incurred an operating loss of
$0.07 per share (net loss of $2.6 million) excluding
restructuring charges of $6.9 million after tax. These charges
relate primarily to the write-off of obsolete airlaid nonwovens
packaging equipment that has been replaced with more efficient
StacPac(TM) lines. Also included in restructuring charges are
severance costs related to workforce reductions.

Net sales in the fiscal year which ended June 30, 2002 were
$635.2 million compared to $731.5 million in the prior year.
During this fiscal year, the Company incurred a loss of $0.20
per share (net loss of $6.9 million) excluding $19.1 million
after tax of restructuring charges and previously reported
goodwill impairment. The goodwill impairment related to the
small single-site converting operation that was part of the
Merfin acquisition.

In addition to the restructuring mentioned above, the Company
has taken a number of steps to enhance its cost performance and
long term competitive position. These include:

     -- Our workforce has been reduced from over 2,200 to under
        2,000.

     -- Sales, Research, and Administration expenses have been
        reduced by about one-third over the past two fiscal
        years.

     -- Capital spending in the fiscal year just ended was
        roughly half the average of the past five years and it
        will be held close to this level in the current year.

     -- Our operations are vigorously increasing efficiency. For
        example at Foley, our largest plant, productivity
        measured in tons per employee has risen 35% since
        Buckeye was formed in 1993.

     -- Due to greatly improved raw material availability and
        cost, we have resumed production at our previously idled
        cotton cellulose plant in Americana, Brazil.

     -- One of the Company's seven airlaid production lines is
        being temporarily idled to improve efficiency and reduce
        industry overcapacity.

Buckeye Chairman, Robert E. Cannon commented that, "The past 18
months has been a difficult period, but we have strengthened our
operations for the future. Consequently, we expect to achieve
substantially better financial results in the current fiscal
year. Further, a company that predominantly manufactures in the
U.S. and makes 75% of its sales outside the U.S. is bound to be
helped by a weaker dollar."

Mr. Cannon went on to say, "Although July-September is
traditionally our slowest quarter because European customers
take vacation shutdowns, we do expect that our results will
progressively improve this quarter and thereafter. We are
confident that we will return to profitability by the October-
December quarter and we anticipate reducing our net debt $50 to
$60 million by the end of this fiscal year."

Buckeye, a leading manufacturer and marketer of specialty
cellulose and absorbent products, is headquartered in Memphis,
Tennessee, USA. The Company currently operates facilities in the
United States, Germany, Canada, Ireland and Brazil. Its products
are sold worldwide to makers of consumer and industrial goods.

                         *    *    *

As previously reported, Standard & Poor's lowered its ratings on
Buckeye Technologies Inc, with negative outlook.

                       Ratings Lowered

                                               Ratings
    Buckeye Technologies Inc.        To                   From
       Corporate credit rating       BB                    BB+
       Subordinated debt rating      B+                    BB-

The downgrade reflects Standard & Poor's expectation that debt
will remain elevated over the intermediate term, which will
likely prevent Buckeye from restoring financial flexibility to a
level appropriate for the previous rating. Capital expenditures
should decline substantially now that construction of the
company's new $100 million airlaid nonwovens machine is
complete. However, weak markets, machine ramp-up costs, and
heightened competitive pressures, are likely to dampen near-term
earnings and impede free cash flow generation.

The ratings reflect Buckeye's below-average business profile,
with leading positions in niche pulp markets, and its aggressive
financial profile.


BUDGET GROUP: Wants to Obtain $434 Mill. Secondary DIP Facility
---------------------------------------------------------------
Edward J. Kosmowski, Esq., at Young Conaway Stargatt & Taylor
LLP, in Wilmington, Delaware relates that prior to the Petition
Date, letters of credit were provided on behalf of Budget Group
Inc., and its debtor-affiliates under a $422,000,000 revolving
credit facility -- as of July 15, 2002 -- pursuant to that
certain Amended and Restated Credit Agreement dated June 19,
1998.  Parties to the Prepetition Credit Agreement are the
Debtors, several lenders, and CSFBNY, as administrative agent.  
This facility was used to issue letters of credit primarily to
provide credit enhancement for the fleet financing debt
issuances by Team Fleet Financing Corp., and, to a lesser
extent, for other corporate purposes.

As of the Petition Date, the Debtors, as Borrowers or
Guarantors, were liable to the Prepetition Secured Lenders and
the Prepetition Agent for:

    (i) $277,388,721 in respect of credit enhancement letters of
        credit for the MTNs,

   (ii) $65,516,896.66 in respect of General Letters of Credit,

  (iii) $3,502,484.50 in respect of undrawn amounts on the CP
        Enhancement Letter of Credit, and

   (iv) $68,782,470.14 in respect of unreimbursed draws on the
        CP Enhancement Letter of Credit.

The reimbursement obligations owed by the Debtors in respect of
letters of credit issued under the Prepetition Credit Agreement
are secured by first priority security interests and liens on
substantially all of the Debtors' prepetition assets.

Thus, the Debtors seek the Court's authority to obtain
postpetition credit enhancement and replacement letters of
credit up to $343,000,000.  This Secondary DIP Facility will be
used for:

    (i) the issuance of letters of credit to replace expiring
        letters of credit that were issued prepetition, and

   (ii) the issuance of new credit enhancement letters of
        credit, not to exceed $200,000,000, for purposes of the
        Postpetition Fleet Financing.

A syndicate of financial institutions, all of which are
Prepetition Secured Lenders, for which CSFBNY will act as agent,
will provide the financing on a priming secured and
superpriority basis.

The Secondary DIP Facility Lenders will provide additional
credit enhancement for the Postpetition Fleet Financing by
essentially rolling their credit enhancement on the Prepetition
Fleet Financing Facility to the Postpetition Fleet Financing
Facility as, and to the extent that, the credit enhancement
requirements, with respect to the Prepetition Fleet Financing
Facility, diminishes as a consequence of principal payments on
the Medium Term Notes resulting from the Rapid Amortization.

"Each Series of Medium Term Notes and Variable Funding Notes
requires the Debtors to maintain a certain level of credit
enhancement with respect to their obligations under the Series,"
Mr. Kosmowski says.  The Debtors used the Prepetition
Enhancement Letters of Credit issued by the Prepetition Secured
Lenders to provide the credit enhancement.  After the Petition
Date, the Debtors anticipate that their outstanding Medium Term
Notes and Variable Funding Notes indebtedness will be reduced as
a consequence of:

    -- continued lease payments, and

    -- application by the Indenture Trustee of Principal
       Collections and Fleet Disposition Proceeds in payment of
       the Medium Term Notes and Variable Funding Notes
       obligations.

Since the required credit enhancement is measured as a
percentage of the outstanding indebtedness, the absolute level
of required credit enhancement will decline correspondingly with
reductions of the principal balance.  "As this occurs, the
Debtors will have the right to reduce the face amount of the
Prepetition Enhancement Letters of Credit issued by the
Prepetition Secured Lenders under the Prepetition Credit
Agreements," Mr. Kosmowski explains.

Accordingly, the Debtors and the Secondary DIP Facility Lenders
have agreed that rather than reduce the face amount of the
letters of credit, the Debtors will obtain a separate court
order:

-- Authorizing the Debtors to reduce the lease payments to
   Team Fleet Financing Corp. by the amount of excess credit
   enhancement that would result if full lease payments were
   made; and

-- Authorizing the lease payment shortfall to be satisfied by
   a draw upon the letters of credit issued under the
   Prepetition Credit Agreement.

The Debtors will repay their reimbursement obligations to the
Prepetition Secured Lenders with respect to the letter of credit
draws in an amount equal to the saved lease payments, in
consideration for the provision by the Secondary DIP Facility
Lenders that will credit enhance the Postpetition Fleet
Financing Facility on a dollar-for-dollar basis.  In addition,
the Debtors will pay their reimbursement obligations in an
amount equal to the saved lease payments only to those
Prepetition Secured Lenders that commit to participate in the
Secondary DIP Facility, and only in amounts that do not exceed
the postpetition commitments extended by the Secondary DIP
Facility Lenders.  The Debtors state that they will employ the
saved lease payments that are not distributed to Secondary DIP
Facility Lenders, and all other operating cash, as additional
cash credit enhancement to support the fleet financing.

The Debtors' obligations under the Secondary DIP Facility will
be secured by security interests and liens in favor of the
Secondary DIP Facility Agent (for the benefit of itself and the
Secondary DIP Facility Lenders) on all of the Collateral.  The
security interests and liens shall have perfection, seniority,
scope and effect set forth in the Secondary DIP Facility Order
and will be entitled to a superpriority claim status pursuant to
Section 364(c)(1) of the Code, which shall rank junior only to
the Primary DIP Facility Obligations and be subject to the
Carve-Out. (Budget Group Bankruptcy News, Issue No. 2;
Bankruptcy Creditors' Service, Inc., 609/392-0900)   

Budget Group Inc.'s  9.125% bonds due 2006 (BD06USR1),
DebtTraders reports, are trading at 14 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=BD06USR1for  
real-time bond pricing.


BURLINGTON: B.I. Transportation Wins Nod to Sell Gaston Terminal
----------------------------------------------------------------
B.I. Transportation, a debtor-affiliate of Burlington
Industries, Inc., obtained permission from the Court the Gaston
Terminal to Dugan free and clear of all liens.

The purchase price is $2,001,000, and will be paid to the Debtor
in two payments:

          (a) $50,000 in earnest money, which was paid upon
              acceptance of the Asset Purchase Agreement; and

          (b) $1,951,000 in cash at the closing;

At the closing, the Debtor will sell, transfer and convey to
Dugan the assets including approximately 26-acre Gaston
Terminal, all buildings and improvements, all fixtures and
appurtenances and all related personal property;

The Debtor also obtained approval of its proposed broker's fee
to be paid to Piedmont Properties. Under the Piedmont Agreement,
Piedmont is entitled to a broker's fee as:

   (i) 5% of the first $1,000,000 of the purchase price;

  (ii) 4% of all amounts between $1,000,000 and $2,000,000 of
       the purchase price; and

(iii) 3% of all amounts between $2,000,000 and $3,000,000 of
       the purchase price. (Burlington Bankruptcy News, Issue
       No. 16; Bankruptcy Creditors' Service, Inc., 609/392-
       0900)   

Burlington Industries' 7.25% bonds due 2005 (BRLG05USR1) are
trading at 18 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=BRLG05USR1
for real-time bond pricing.


COLUMBIA LABORATORIES: Selling 1M+ Shares to PharmBio for $5.5MM
----------------------------------------------------------------
Columbia Laboratories, Inc., is offering an aggregate of
1,121,610 shares of its common stock directly to PharmaBio
Development Inc., at a price of $4.903667 per share.  The
Company will receive gross proceeds of $5,500,000 before
deducting expenses of the offering.

Columbia's common stock trades on the American Stock Exchange
under the symbol COB. On July 30, 2002, the last reported sale
price of the common stock on the AMEX was $4.90 per share.

Columbia Laboratories, Inc., is a U.S.-based international
pharmaceutical company dedicated to research and development of
women's health care and endocrinology products, including those
intended to treat infertility, dysmenorrhea, endometriosis and
hormonal deficiencies. Columbia is also developing hormonal
products for men and a buccal delivery system for peptides.
Columbia's products primarily utilize the company's patented
bioadhesive delivery technology.

As of March 31, 2002, Columbia's balance sheet is upside-down
with a total shareholders' equity deficit of about $4 million.


COMDISCO: Panel Gets Okay to Withdraw Chaim Fortgang as Counsel
---------------------------------------------------------------
The Court authorizes the withdrawal of Chaim J. Fortgang as co-
counsel to the Official Unsecured Creditors' Committee in the
chapter 11 cases involving Comdisco, Inc., and its debtor-
affiliates.  Latham & Watkins will continue as sole counsel to
the Committee.  Any compensation for legal services rendered and
reimbursement of expenses incurred by Chaim J. Fortgang prior to
July 1, 2002 will be paid from the Debtors' estates.  "Mr.
Fortgang will receive no reimbursement or fees incurred after
July 1, 2002," Judge Barliant directs. (Comdisco Bankruptcy
News, Issue No. 33; Bankruptcy Creditors' Service, Inc.,
609/392-0900)   


CONTINUCARE CORP: Has Until Year-End to Meet Nasdaq Requirements
----------------------------------------------------------------
Continucare Corporation (AMEX:CNU), a leader in the fields of
third party management of medical risk and home healthcare
services in the Florida market, announced that the American
Stock Exchange has completed its review of the Company's listing
qualifications.

As previously reported, the Company has fallen below AMEX
continued listing standards relating to shareholders' equity and
losses from continuing operations. In response to this
notification, the Company submitted a plan of compliance to the
AMEX. On July 30, 2002, the AMEX accepted the Company's plan to
bring it in compliance by December 31, 2003, and granted this
extension to the Company. The plan includes quarterly
milestones. If the Company does not show progress in obtaining
these milestones or if the Company is unable to regain
compliance with the continued listing standards by December 31,
2003, the Company's Common Stock may be delisted from the AMEX.

Continucare Corporation, headquartered in Miami, Florida, is a
holding company with subsidiaries engaged in the business of
third party management of medical risk by providing outpatient
healthcare services through managed care arrangements and home
healthcare services.


CONVERSE INC: Exits Chapter 11 Bankruptcy Proceeding
----------------------------------------------------
On June 6, 2002, the United States Bankruptcy Court for the
District of Delaware confirmed the Second Amended Chapter 11
Plan of CVEO Corporation, formerly named Converse, Inc., and an
order was signed and entered by the Court on that date. Under
the terms of the Plan, holders of common stock of the Debtor
will not receive any distribution on account of such stock, and,
on the effective date of the Plan, all outstanding common stock
of the Debtor, and all options and other rights to acquire
common stock of the Debtor will be cancelled and will be of no
further force or effect. The Debtor's Plan was declared
effective on July 31, 2002.

Converse has sold nearly 575 million pairs of that American
classic, the Chuck Taylor All Star canvas basketball shoe, which
has appealed to everyone from computer programmers to clothing
designers to rock stars, never mind gym rats and neighborhood
kids. It also licenses sports apparel from head to toe. Its
products are sold in 110 countries through about 5,500 sporting
goods, department, and shoe stores, as well as about 25 company-
operated retail outlets. Following years of declining sales, the
company filed for Chapter 11 bankruptcy protection in 2001.
Footwear Acquisition has purchased the company, which intends to
continue operations.


CORNERSTONE PROPANE: Will Defer Publishing Fiscal Year Results
--------------------------------------------------------------
CornerStone Propane Partners, L.P. (NYSE: CNO), announced its
decision not to issue an earnings release for its fiscal year
ending June 30, 2002 and the cancellation of the analyst call
scheduled for Today, August 8, 2002.

Yesterday the Partnership announced that it is continuing to
review its financial restructuring and strategic options,
including the commencement of a Chapter 11 case under the United
States Bankruptcy Code.  CornerStone has begun to prepare to
commence a Chapter 11 case under the United States Bankruptcy
Code.

CornerStone Propane Partners, L.P., is a master limited
partnership.  The Partnership is one of the nation's largest
retail propane marketers, serving approximately 440,000
customers in more than 30 states.  For more information, please
visit its Web site at http://www.cornerstonepropane.com


CORNERSTONE PROPANE: Fitch Downgrades Ratings to Default Level
--------------------------------------------------------------
Fitch Ratings has downgraded Cornerstone Propane Partners,
L.P.'s outstanding $45 million senior notes to 'D' from 'C' and
Cornerstone Propane, L.P.'s outstanding $365 million senior
secured notes to 'DD' from 'C'. NorthWestern Corp. (NOR; 'BBB+'
senior unsecured debt rating, Rating Watch Negative by Fitch),
controls approximately 30% of the equity interest of CNO though
its subordinated unit and 2% general partner interest. CNO in
turn is a retail propane master limited partnership for CPLP, an
operating limited partnership.

The rating action follows the announcement on Aug. 5, 2002 that
the partnership has elected not to make the approximate $5.6
million interest payment on three tranches of CPLP's outstanding
senior secured notes which was due on July 31, 2002. In
addition, the partnership has announced that it is continuing to
review its financial and strategic options, including the
commencement of a Chapter 11 case under the U.S. Bankruptcy
Code.

While expected recovery values are highly speculative and cannot
be estimated with any precision, a 'DD' rating for CPLP
indicates potential recoveries in the range of 50% to 90%, while
a 'D' rating for CNO indicates a recovery level below 50%. For
the last 12 month period ended March 31, 2002, a period marked
by significantly warmer than normal winter weather, CPLP's
acquisition adjusted EBITDA approximated $62.8 million.
Utilizing a distressed multiple of 4.0 times (normalized
industry multiples have often exceeded 6.0x), the partnership's
current enterprise value can be conservatively estimated at
about $250 million. It is Fitch's understanding that the
partnership has $17.7 million of borrowings and $8.3 million of
letters of credit outstanding under a $50 million credit
facility guaranteed by Northwestern Corp.


CORNERSTONE: NYSE Halts Trading & Will Strike Shares from List
--------------------------------------------------------------
CornerStone Propane Partners, L.P. (NYSE: CNO) has received
notification from the New York Stock Exchange that trading in
its Common Units had been suspended and that the issue will be
removed from the NYSE's trading list.  The trading suspension is
effective immediately.  The NYSE indicated that it would make
appropriate filings with the Securities and Exchange Commission
to remove the listing of the Common Units on the NYSE, pending
completion of applicable procedures. Cornerstone reported that
the NYSE's delisting action is not expected to affect its
current operations or financial position.

CornerStone Propane Partners, L.P., is a master limited
partnership.  The Partnership is one of the nation's largest
retail propane marketers, serving approximately 440,000
customers in more than 30 states.  For more information, please
visit its Web site at http://www.cornerstonepropane.com


COX TECHNOLOGIES: Cherry Bekaert Raises Going Concern Doubt
-----------------------------------------------------------
Cox Technologies, Inc., was incorporated as Mericle Oil Company
in July 1968, under the laws of the State of Arizona. The name
was changed to Energy Reserve, Inc. in August 1975. In November
1994, Energy Reserve acquired Twin-Chart, Inc. and altered its
primary business focus from crude oil operations to temperature
recording and monitoring operations. As a result of this change
in focus, the Company changed its name to Cox Technologies,
Inc., in April 1998. The Company reincorporated in the State of
North Carolina in December 2000.

The core business of the Company is to provide reliable
temperature monitoring products and develop new and
technologically advanced monitoring systems. The Company
produces and distributes transit temperature recording
instruments, including electronic "loggers," graphic temperature
recorders and visual indicator tags, both in the United States
and internationally. Transit temperature recording instruments
create a strip chart record of temperature changes over time, or
record temperatures electronically according to a present
interval. The Company sells and manufactures both types of
transit monitoring products, and is said to have established an
international market presence and reputation for reliable
temperature recording products.

Revenue from sales decreased $1,082,458, or 11%, in fiscal 2002
as compared to fiscal 2001, due to a 13% decrease in the number
of Cox1 units sold as a result of decreased demand and a 4%
decrease in average sales price. Sales of DataSource(R) units
increased 129%, slightly offset by a 4% decrease in average
sales price during fiscal 2002. During fiscal 2002, a large
grocery store chain started requiring its shippers to use the
DataSource(R) units exclusively. The Company has recently
reached an agreement with another large grocery store chain that
will require their shippers to use the DataSource(R) unit
exclusively. Fiscal 2002 reflects a 22% decrease in the number
of Tracer(R) products sold and a 4% decrease in average sales
price. Management believes that the Company will continue to
experience a decrease in average sales price for all products
due to competitive price pressure, but expects unit sales for
its primary products to remain constant or, in the case of
electronic loggers, increase in future periods. During fiscal
2002, the sale of graphic recorders represented $6,751,000, or
78% of total revenues, the sale of electronic data loggers
represented $1,472,000, or 17%, the sale of probes and related
products represented $129,000, or 2%, and the sale of Vitsab(R)
products represented $112,000, or 1%. The sale of oil and other
miscellaneous products represented the balance.

The Company recorded a foreign currency translation adjustment
in fiscal 2002 and fiscal 2001 of $40,413 and a loss of
$108,581, respectively. As a result, total comprehensive loss
was $5,122,633 as compared to a net loss of $5,163,046 for
fiscal 2002 and $6,882,590 as compared to a net loss of
$6,774,009 for fiscal 2001.

The Company has sustained substantial operating losses in recent
years. In addition, the Company has used substantial amounts of
working capital in its operations. Further, at April 30, 2002,
current liabilities exceed current assets by $390,850 and total
liabilities exceed total assets by $2,305,523. The Company is
currently in violation of certain loan covenants and has entered
into note modification agreements with Centura, effective
January 31, 2002 that extended the maturity dates of all three
loans to July 31, 2002. Centura will continue to meet with
Company management to review the financial results and determine
whether to extend the maturity date of all three loans past July
31, 2002.

In view of these matters, realization of a major portion of the
assets is dependent upon continued operations of the Company,
which in turn is dependent upon the Company's ability to meet
its financing requirements, and the success of its future
operations.  Management believes that actions presently being
taken to revise the Company's operating and financial
requirements provide the opportunity for the Company to continue
as a going concern.

However, the independent auditor's for the Company, Cherry,
Bekaert & Holland, L.L.P. of Gastonia, North Carolina, in its
July 3, 2002, Auditors Report has stated: "As shown in the
consolidated financial statements, the Company incurred a net
loss of $5,163,046 for 2002 and has incurred substantial losses
for each of the past three years. At April 30, 2002 current
liabilities exceeded current assets by $390,850, and total
liabilities exceeded total assets by $2,305,523. The Company is
currently in violation of certain loan covenants ....and has
entered into note modification agreements with its lender,
effective January 31, 2002 that extended the maturity dates of
the loans to July 31, 2002. These factors raise substantial
doubt about the Company's ability to continue as a going
concern. The consolidated financial statements do not include
any adjustments relating to the recoverability and
classification of recorded assets, or the amounts and
classification of liabilities that might be necessary in the
event the Company cannot continue in existence."


DDI CORP: Fails to Maintain Nasdaq Continued Listing Standards
--------------------------------------------------------------
DDi Corp. (Nasdaq: DDIC), a leading provider of time-critical,
technologically advanced, interconnect services for the
electronics industry, has received a notice from Nasdaq that its
common stock has failed to maintain a minimum closing bid price
of $1.00 over a period of 30 consecutive trading days.  As a
result, Nasdaq has provided the Company with 90 calendar days,
until November 4, 2002, to regain compliance with this
requirement by achieving a minimum closing bid price of $1.00
for ten consecutive trading days.  If the Company is unable to
demonstrate compliance with the requirement on or before
November 4, 2002, Nasdaq will provide the Company with written
notification that its securities will be delisted within seven
days, which may be appealed by the Company at that time.

Management and the Company's Board of Directors are evaluating
various alternatives to address this issue.

DDi is a leading provider of time-critical, technologically
advanced, design, development and manufacturing services.  
Headquartered in Anaheim, California, DDi and its subsidiaries,
with design and manufacturing facilities located across North
America and in England, service approximately 2,000 customers
worldwide.  DDi Corp., common stock trades on the Nasdaq
National Market.


DT INDUSTRIES: Will Make Adjustments to Financial Statements
------------------------------------------------------------
DT Industries, Inc. (Nasdaq: DTII), an engineering-driven
designer, manufacturer and integrator of automation systems and
related equipment used to manufacture, assemble, test or package
industrial and consumer products, reported that, in connection
with the implementation of its corporate integration plan, it
has discovered that it will be required to make certain
accounting adjustments to its consolidated financial statements.  
The accounting adjustments stem from an understatement of cost
of sales at the Company's Assembly Machines, Inc., subsidiary
due to an overstatement of the balance sheet account entitled
costs and estimated earnings in excess of amounts billed on
uncompleted contracts.  AMI, located in Erie, Pennsylvania, is a
small facility in the Company's Precision Assembly Division.  As
a result of these adjustments, the Company expects to restate
its audited consolidated financial statements for fiscal years
1999, 2000 and 2001 and the unaudited consolidated quarterly
financial information for the fiscal year 2002, as previously
released.  The Company currently estimates that the aggregate
pre-tax effect of the accounting adjustments on its earnings for
these periods is approximately $6.0 million, or approximately
$3.9 million after taxes.  This estimated increase of $3.9
million in after-tax net loss for the period 1999 through March
24, 2002 represents approximately 4.1% of the cumulative $94.1
million after-tax net loss reported for this period.  As a
result of the adjustments, the Company will review the goodwill
of AMI to determine whether it should be written down to reflect
possible impairment.

"While we're disappointed that adjustments to our historical
financials statements are necessary, we are encouraged that our
increased efforts to integrate our operations have brought this
development to light.  Our forecast for future earnings should
not be adversely impacted by these accounting adjustments, and
we still confidently believe that, as a result of our recently
completed recapitalization transaction and substantial ongoing
integration efforts, we will be poised to take advantage of an
upturn in the economy," said Steve Perkins, president and chief
executive officer.

As part of an ongoing effort to improve its operating
efficiency, internal controls and financial reporting system,
the Company recently implemented a plan to integrate its
operating subsidiaries and centralize various management and
accounting functions.  As part of this integration plan, the
Company has been in the process of transferring the sales and
accounting functions at AMI to its Precision Assembly Division
headquarters in Buffalo Grove, Illinois. During this process,
the Company discovered the need for the accounting adjustments
at AMI.  Upon its discovery, the Company's Audit Committee
retained outside counsel to assist the Company in conducting a
formal inquiry into the matter.  Counsel to the Audit Committee
has engaged an outside accounting firm to assist in the inquiry.

The Company intends to announce its results of operations for
the 2002 fiscal year and more details regarding the restatement
of its financial statements for prior periods by the end of
August.


DADE BEHRING: Hires Jones Day as Recapitalization Claims Counsel
----------------------------------------------------------------
Dade Behring Holdings, Inc., and its debtor-affiliates ask for
permission from the U.S. Bankruptcy Court for the Northern
District of Illinois to hire Jones Day Reavis & Pogue as their
special counsel.

The Debtors want Jones Day to act as special counsel to provide
services with respect to issues that may arise during the
Chapter 11 Cases related to:

     i) the 1999 Recapitalization,

    ii) any objections to the settlement of claims relative to
        the 1999 Recapitalization, as embodied in the Plan and

   iii) the defense of any settlement.

The Debtors submit that Jones Day have an intimate knowledge of
the facts and circumstances surrounding the 1999
Recapitalization and that it is highly capable of representing
the Debtors in this regard.

While certain aspects of the representations may necessarily
involve both Jones Day and Kirkland & Ellis, the Debtors assure
the Court that the services Jones Day will provide will be
complementary rather than duplicative of Kirkland & Ellis'
services.

Jones Day's professionals' hourly rates are:

     Richard M. Cieri         Partner         $650 per hour
     John Newman, Jr.         Partner         $605 per hour
     Daniel Reidy             Partner         $540 per hour
     James White              Partner         $405 per hour
     Kevin Orr                Of Counsel      $450 per hour
     Michelle Morgan Harner   Associate       $360 per hour
     Charles Bensinger III    Associate       $290 per hour
     Susan Winders            Associate       $275 per hour
     Michael C. Rupe          Associate       $260 per hour
     Ronald L. Cappellazzo    Staff Attorney  $150 per hour
     Linda Montgomery         Legal Assistant $134 per hour

The Debtors comprise the sixth largest manufacturer and
distributor of in vitro diagnostic products in the world. The
Debtors primarily sell diagnostic systems that include
instruments, reagents, consumables, service and date management
systems.  Of the total estimated $20 billion annual global IVD
market, the Debtors serve a $12 billion segment targeted
primarily at clinical laboratories. The Company filed for
chapter 11 protection on August 1, 2002. James Sprayregen, Esq.,
at Kirkland & Ellis represents the Debtors in their
restructuring efforts.


EASYLINK SERVICES: Working Capital Deficit Tops $14MM at June 30
----------------------------------------------------------------
EasyLink Services Corporation (NASDAQ: EASY), a leading global
provider of services that power the exchange of information
between enterprises, their trading communities and their
customers, reported financial results for the second quarter and
six months ended June 30, 2002.

Revenues for the second quarter of 2002 were $30.0 million, in
line with expectations, as compared to $33.9 million in the
second quarter of 2001. Gross margin increased to 52% in the
second quarter, up from 35% in the comparable quarter a year ago
and also in line with expectations, resulting from reductions in
operating expenses and the divestiture of non-core operations.
The Company is pleased to report that it achieved its fourth
consecutive quarter of positive pro-forma EBITDA during the
second quarter of 2002 of $3.0 million as compared to a negative
$4.4 million in the second quarter of 2001. Having completed a
full year of positive pro-forma EBITDA results, our trailing 12-
month pro-forma EBITDA is $13.8 million. Pro-forma EBITDA is
equal to the loss from continuing operations reduced by
interest, taxes, depreciation expense, amortization of goodwill
and other intangibles, amortization of stock and warrants,
impairment and restructuring charges, loss on sale of business,
impairment of intangible assets, release of bonus accrual and
impairment on investments.

EasyLink's pro-forma loss from continuing operations was $1.0
million in the second quarter of 2002, compared to a pro-forma
loss from continuing operations of $12.8 million for the quarter
ended June 30, 2001. Pro-forma loss for the second quarter of
2002 excludes amortization of intangibles and the release of a
bonus accrual. The pro-forma loss from continuing operations for
the second quarter of 2001 excludes amortization of goodwill and
other intangibles, restructuring and impairment charges,
impairment of intangible assets and impairment on investments.
All per share amounts are based on the weighted average number
of basic and diluted shares outstanding, which were 16,541,485
and 8,792,934 for the 2002 and 2001 second quarters,
respectively.

Under Generally Accepted Accounting Principles (GAAP), the
Company's net loss for the second quarter of 2002 improved to
$1.3 million compared to a loss from continuing operations of
$48.2 million, and a net loss of $59.1 million for the second
quarter of 2001. The net loss for the second quarter of 2002 was
positively impacted by a net release of $1.7 million in accrued
expenses primarily resulting from the decision not to pay prior
year cash bonuses in 2002. Also, as previously disclosed, on
January 1, 2002, the Company adopted Financial Accounting
Standards Board Statement No. 142 - Goodwill and Other
Intangible Assets. This required that companies no longer
amortize goodwill, but instead test goodwill for impairment on
an annual basis. A third party has completed an initial
impairment assessment for the Company and has determined that
there was no impairment in goodwill as of January 1, 2002.
Amortization of goodwill and other intangibles for the quarter
ended June 30, 2001 includes $10.6 million of goodwill
amortization in continuing operations and $0.3 million in
discontinued operations, which is not included in the comparable
period of 2002.

The Company's cash and marketable securities balance increased
to $12.0 million as of June 30, 2002 compared to $10.9 million
as of March 31, 2002.

As of June 30, 2002, the Company's balance sheet shows that its
total current liabilities exceeded its total current assets by
about $14 million.

Thomas Murawski, President and Chief Executive Officer of
EasyLink, said, "EasyLink's second quarter results reflect a
continued focus on strengthening the fundamentals of our
business under our control, such as cost containment and cash
management, as well as an improved overall quality of services
and responsiveness to customer needs. Despite the continuing
difficult economic environment, we were successful at delivering
results in line with expectations. In January, we outlined our
2002 Strategy based on our belief that a Company focused on
electronic transaction delivery is a fundamentally sound
business with substantial growth potential. The fact that we've
generated almost $14 million in EBIDTA in the last 12 months is
clear evidence that we were correct, and accordingly, we believe
we are on track to deliver on our 2002 Strategy.

"As part of that strategy, we announced a plan to increase the
accessibility of our transaction delivery services through the
introduction of new services enabling transactions between large
enterprises and small- to mid-sized companies in their trading
communities, increasing the number of companies they conduct
business with electronically. A key accomplishment of the second
quarter demonstrating that we are on track with our 2002
Strategy is the addition of Web-based EDI to our service line
through a partnership with SPS Commerce, addressing this
critical market need. This enhancement to our service line is
expected to grow the overall volume and variety of transactions
the Company manages.

"EasyLink continued to focus on our blue-chip customer base in
the second quarter as is evident through the recent significant
wins for our transaction delivery services including
JPMorganChase, General Motors, Pepperidge Farm and Xerox, which
we expect to hit our top line within the next six months.
Additionally, our sales organization is seeing increased demand
for our services and we believe we have a strong sales pipeline
ahead."

                     Customer Relationships

During the second quarter, EasyLink continued to broaden and
deepen its customer relationships primarily due to strong
customer interest in EasyLink's high-volume, transaction-
delivery services. In North America, the following companies
either established, renewed or expanded deployment of EasyLink's
services during the quarter: ADP, BankOne, Deutsche Bank,
Fiserv, GE, JPMorganChase, Pepperidge Farm, Sav A Lot, Sears,
Super-Valu, Trustmark Insurance, United Airlines, Xerox and
Yahoo! Merchant Services.

Internationally, several companies also either established or
expanded deployment of our services during the quarter.
Specifically, in Europe, Citibank, CSFB, Eurocar, Toyota, Rover,
Gtek, GE, OOCL and Pgmedia were added. In the Asia Pacific
region, new or expanded existing customers include Phillipine
Standard Shipping and Worlder Shipping. For our Latin America,
Middle East and Africa regions, Travel Market and Orient Tours
were added. In India, GATI, ICICI, Leo Shipping, Mach India,
American Express, GE and Toyota are new additions. And in the
Singapore/Malaysia region, IFX Corporation, Komag USA, Federal
Express, Phoenix Rubber and World Alliance either signed on or
expanded their EasyLink relationship.

                     Strategic Partnerships

During the quarter, EasyLink formed a strategic partnership with
SPS Commerce, the leading supply chain integration service
provider, to offer a comprehensive solution for enterprises to
grow their electronic trading communities. As a result, EasyLink
is now offering Trading Community Enablement services enabling
e-commerce for companies of all sizes. EasyLink and SPS bring
the well-known benefits of EDI such as fast, error-free,
paperless transaction delivery available to the entirety of a
larger corporation's trading community through low-cost,
customized easy-to-use network services.

                    NJ Office Consolidation

In July, EasyLink finalized its plans for consolidating all NJ-
based office facilities and data centers. The move from its
current corporate headquarters in Edison to Piscataway, NJ will
begin before the end of the year. While the Company will incur
up-front expenses for the new facility over the short-term, the
long-term efficiencies resulting from this consolidation will
reduce operating expenses and provide us with a single
headquarters operating location featuring high quality data
center space where we will build a world class global network
operating center.

"We will always have multiple data centers to provide our
customers with a level of redundancy to support continuous
operation. However, consolidating our smaller data centers into
one location will provide us with substantial operating
efficiencies, reduce the complexity of network connectivity and
enable EasyLink to provide a higher quality service to its
customers," said Murawski.

                       Six Months Results

Revenues for the six months ended June 30, 2002 increased to
$60.3 million from $53.6 million in the six months ended June
30, 2001. For the six months ended June 30, 2002, the Company's
pro-forma loss from continuing operations improved to $1.6
million compared to a pro-forma loss from continuing operations
of $34.7 million for the six months ended June 30, 2001. This
pro-forma loss from continuing operations excludes amortization
of goodwill and other intangibles, restructuring and impairment
charges, loss on sale of businesses, impairment/equity loss on
investments, impairment of intangible assets, release of bonus
accrual, as well as amortization of stock and warrants.

Under GAAP, the Company's net loss for the six months ended June
30, 2002 improved to $3.9 million compared to a reported loss
from continuing operations of $102.1 million and a net loss of
$127.7 million for the six months ended June 30, 2001.
Amortization of goodwill and other intangibles for the six
months ended June 30, 2001 includes $21.6 million of goodwill
amortization in continuing operations and $3.7 million in
discontinued operations, which is not included in the comparable
period of 2002.

                        Business Outlook

The following statements are forward looking and actual results
may differ materially due to factors noted at the end of this
release, among others.

EasyLink expects the following for the third quarter of 2002:

     - Revenues are expected to be approximately $30 million.

     - Gross margin is expected to remain at approximately 50%.

     - Due to the Company's plan to consolidate its NJ-based
       office facilities and data centers, it expects to incur a
       restructuring charge in the range of $2 to $3 million
       primarily related to redundant facilities and equipment.

     - Pro-forma EBITDA is expected to be in the range of $2 to
       $4 million.

     - Pro-forma loss from continuing operations is expected to
       be in the range of $2 million to $0 million.

EasyLink expects the following for the full year 2002:

     - Revenues are expected to be in the range of $120 to $125
       million.

     - Gross margin is expected to be approximately 50%.

     - Pro-forma EBITDA is expected to be in the range of $12 to
       $14 million.

     - The Company continues to expect the full year 2002 pro-
       forma net loss to be less than $4 million. Despite the
       continued difficult economy, the Company is striving to
       achieve pro-forma profitability for the fourth quarter of
       2002.

"We will continue to focus on strengthening our business
fundamentals and we remain committed to improving the Company's
profitability. Through continued success at executing our
strategy, we will be able to aggressively pursue the enormous
opportunity that the transaction delivery and management market
presents us, and believe that our efforts will be for the long-
term benefit of our shareholders," concluded Murawski.

EasyLink Services Corporation (NASDAQ: EASY), headquartered in
Edison, New Jersey, is a leading global provider of services
that power the exchange of information between enterprises,
their trading communities, and their customers. EasyLink's
network facilitates transactions that are integral to the
movement of money, materials, products, and people in the global
economy, such as insurance claims, trade and travel
confirmations, purchase orders, invoices, shipping notices and
funds transfers, among many others. EasyLink helps more than
20,000 companies, including over 400 of the Global 500, become
more competitive by providing the most secure, efficient,
reliable, and flexible means of conducting business
electronically. For more information, please visit
http://www.EasyLink.com  


ENRON CORP: SEC Has Until November 27, 2002 to File Claims
----------------------------------------------------------
Enron Corporation and the Securities and Exchange Commission
sought and obtained the Court's approval of their Stipulation
extending to November 27, 2002 -- the deadline within which the
SEC may file their general unsecured claim against the Debtors.
(Enron Bankruptcy News, Issue No. 38; Bankruptcy Creditors'
Service, Inc., 609/392-0900)

Enron Corp.'s 9.125% bonds due 2003 (ENRN03USR1) are trading at
11.5 cents-on-the-dollar, DebtTraders says. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=ENRN03USR1
for real-time bond pricing.


ENRON CORP: Gov't Entities Obtain Time Extension to File Claims
---------------------------------------------------------------
Enron Corporation, its debtor-affiliates, the United States
Attorney, and Pension Benefit Guaranty Corporation sought and
obtained Court approval of a stipulation fixing the Bar Date of
federal government agencies to be on the same date for creditors
to file proofs of claim in the Debtors' bankruptcy cases.  No
order setting the bar date for filing proofs of claim has been
requested or entered in these cases yet.

The stipulation does not prejudice the federal agencies' rights
from seeking further extensions or the Debtors' rights to object
to any further extension. (Enron Bankruptcy News, Issue No. 38;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


EPICEDGE: AMEX Accepts Plan to Meet Continued Listing Standards
---------------------------------------------------------------
EpicEdge, Inc. (Amex: EDG), a leading information technology
consulting firm, announced that the American Stock Exchange has
accepted the Company's plan for regaining compliance with Amex's
continued listing standards and granted EpicEdge an extension of
time in which to do so.

On May 28, 2002 the Company received notice from AMEX indicating
that EpicEdge was below the Exchange's continued listing
standard set forth in Section 1003(a)(i) of the Amex Company
Guide due to 1) losses in two of the three most recent fiscal
years, 2) shareholders' equity below $2 million, and 3) failure
to hold the Company's annual meeting in fiscal year 2001.

The plan, which was submitted to the American Stock Exchange on
June 26, 2002, provides specific milestones for regaining
compliance. EpicEdge achieved one of the continued listing
standards by holding its Annual Meeting for fiscal year 2002 on
July 12 in Austin, TX. The Company will need to achieve other
milestones to include conversion of debt, additional funding,
and an improvement of operational results.

EpicEdge will be subject to periodic review by Amex staff during
the extension period. Failure to make progress consistent with
the plan or to regain compliance with the continued listing
standards by the end of the extension period could result in the
Company being delisted from the American Stock Exchange.

EpicEdge, Inc., is a leading information technology consulting
firm, primarily focused on serving state and local government
agencies, commercial and utility market customers. We help our
clients to meet their business goals through implementation and
support of client/server and Internet-enabled enterprise
resource planning software packages, custom Web application
development, and strategic consulting. We deliver successful IT
project-based services by combining the elements of market-
leading products, third-party products such as PeopleSoft,
highly skilled technical personnel, and proven project
methodologies. Our focused and comprehensive approach to
technology is driven by our client's business needs, and helps
clients maximize return on their software investment and lower
their total cost of ownership.


EXOTICS.COM: Merdinger Fruchter Expresses Going Concern Doubt
-------------------------------------------------------------
Exotics.com provides on-line visual directories of male oriented
entertainment service through its subsidiary Exotics.com
(Delaware). By continuing to build an international brand and
attract millions of highly desirable visitors to its Web sites,
exotics.com is creating a springboard to launch a variety of
exotic and luxury related goods and services targeted at its
core customer - the affluent male pursuing an exotic and
luxurious lifestyle.

Exotics has developed a network of approximately 39 city Web
sites and a national Web site -- http://www.exoticsusa.com--  
which in the aggregate generate in excess of 40 million page
views and over 4 million unique visitors per month. Management
believes that the on-line photo classified ads offered by the
Exotics.com are superior in quality, and reach a greater
audience than traditional print ads.  Exotics.com receives
licensing fees equal to 15 to 20% of the total network revenue.

The typical Exotics.com user has expressed an interest in high-
end cars, luxury homes, pleasure boats, and exotic travel.

As of December 31, 2001, the Company had cash and cash
equivalents of $2,514.  As of the same date, the Company had
total working capital deficiency of $1,639,666, including a
short-term component of deferred revenue of $25,881.  Deferred
revenue represents excess of cash received from licenses over
revenue recognized on license contracts, and the short-term
component represents the amount of this deferred revenue
expected to be recognized over the next twelve months.  Without
the short-term component of deferred revenue, working capital
deficiency would have been $1,613,785 at December 31,
2001.

Net revenues during the year ending December 31, 2001 were
$519,837, less cost of sales of $191,725 for a gross profit of
$328,112. Revenues for the comparative year ending December 31,
2000 were $470,202, less cost of sales of $259,246 for a gross
profits of $210,956.  Current revenue sources consist primarily
of fees based on advertising revenues from each city, and
monthly service fees. Exotics.com-Delaware is currently planning
a national advertising campaign, which will generate national
advertising revenue for ads displayed over its international
network of sites. It has also entered into affiliate programs
with a number of sites offering merchandise that appeal to its
viewers. The Company expects this to increase revenues over the
coming months.

During the year ended December 31, 2001, the operating expenses
of $4,029,810 were comprised of salaries and employee benefits
totaling $312,516, professional and other consulting fees
totaling $1,748,042 and general and administrative expenses
totaling $778,498, as well as stock discount expense of
$1,026,143 and travel and entertainment expense of $164,611.  
During the year ended December 31, 2000, the operating expenses
of $1,349,854 were comprised of salaries and employee benefits
totaling $591,158, professional and other consulting fees
totaling $333,131 and general and administrative expenses
totaling $425,565.  The increase in operating expenses is due to
a stock discount expense of $1,026,143 and travel and
entertainment expense of $164,611.

Net loss for the year ended December 31, 2001 was $3,947,659 or
$1.46 per share.  The net loss for the comparative year ended
December 31, 2000 was $1,246,382 or US $0.92 per share.  The
increase in net loss is due to higher professional and
consulting fees, as well as stock discount expense recognized on
stock issuance for debt and account payable.

Merdinger, Fruchter, Rosen & Company, P.C., independent auditors
for Exotics.com, have stated, in their June 28, 2002 Auditors
Report:  "The accompanying consolidated financial statements
have been prepared assuming that the Company will continue as a
going concern.  The Company has incurred substantial losses from
operations and has a working capital deficiency, which raises
substantial doubt about its ability to continue as a going
concern."


FOCAL COMMS: Reports Improved Results for Second Quarter 2002
-------------------------------------------------------------
Focal Communications Corporation (Nasdaq: FCOM), a leading
national communications provider of local phone and data
services, announced results for its second quarter ended June
30, 2002.  Focal reported second quarter revenue of $94.4
million, a 12% increase from the previous quarter and a 15%
increase year-over-year.  Revenue included several non-recurring
revenue items, the net impact of which was an increase in
revenue of $10.4 million in the quarter.  These items included
prior period carrier revenue of $12.6 million, the resolution of
regulatory rate uncertainty and disputes totaling a net of $1.6
million, customer service credits of negative $5.0 million and
one-time termination fees of $1.2 million.  The Company also
reported that cash and cash equivalents increased by almost $6
million and that DSOs (days sales outstanding) fell by 21% from
the previous quarter.

EBITDA (earnings before interest, taxes, depreciation and
amortization, restructuring costs and non-cash compensation)
during the second quarter of 2002 improved to a deficit of $2.4
million, compared to a deficit of $3.8 million in the first
quarter.  During the quarter, the Company increased its reserve
for doubtful accounts by $10.0 million, which included $12.1
million in bad debt expense, offset by $2.1 million in write-
offs of uncollectible accounts.  Focal's total reserve for
doubtful accounts at the end of the quarter was $22.5 million,
or 19.7% of gross accounts receivable.  The Company believes it
is adequately reserved for exposure to WorldCom and other
financially troubled carriers and customers.  Focal reported a
net loss applicable to common shareholders for the second
quarter of $52.7 million.  This compares to a net loss
applicable to common shareholders of $57.2 million for the first
quarter 2002.

"Focal continues to perform well in a very difficult competitive
environment," commented Kathleen Perone, president and chief
executive officer.  "Our narrowing quarter-over-quarter EBITDA
loss and steady enterprise revenue growth are indicators that
the core of Focal's business remains healthy."

Perone continued, "Focal added over 400 new customers during the
quarter, many of which bought our new Integrated Voice and Data
service.  In addition to growing the Company via new business,
we are focusing on leveraging our existing premier customer base
by selling them additional products in more of our markets.  In
these turbulent times, enterprises are looking to diversify
their communications providers.  Focal is well-positioned to
provide this essential diversity, backed by our high-quality
network and unparalleled customer service."

"During the quarter, we saw improvement in working capital
management," said Jay Sinder, treasurer and chief financial
officer.  "Cash and cash equivalents increased to $75.7 million
from $69.9 million in the previous quarter, including a draw of
$5.0 million on our bank credit facility.  Our efforts to
improve collections are beginning to yield results, bringing
more cash in the door.  In part, this effort contributed to the
23 day decrease in DSOs, which also benefited from non-recurring
revenue items and the additions to our bad-debt reserve."

Sinder added, "We also continue to aggressively manage our SG&A
expenses. Headcount at the end of the quarter was 12% lower than
the beginning of the year as we improved operational
efficiencies at headquarters and in all of our markets."

            Selected Operational Results and Statistics

Enterprise Business - Second quarter enterprise revenue, which
includes customers from our direct sales, wholesale and agent
channels, was $57.9 million, a 15% increase from $50.5 million
in the previous quarter and a 46% increase from $39.7 million a
year ago.  Adjusted for non-recurring revenue items in the
current quarter and the second quarter of 2001, enterprise
revenue was $54.8 million, a 9% increase sequentially and a 62%
increase from $33.8 million a year ago.  Enterprise lines now
comprise 72% of total installed lines, compared to 65% in the
first quarter 2002 and 50% a year ago.  During the second
quarter, Focal installed 64,472 gross enterprise lines and
disconnected 22,103 enterprise lines, resulting in net
enterprise line installs of 42,369.

Internet Service Provider Business - Revenue from Internet
Service Providers in the second quarter of 2002 was $36.5
million, compared to $34.0 million for the first quarter of 2002
and $42.5 million a year ago. Adjusted for non-recurring revenue
items in the current quarter and the second quarter of 2001, ISP
revenue was $29.2 million, a 14% decrease sequentially and a 31%
decrease from $42.5 million a year ago.  While line disconnects
in the ISP segment continued during the quarter, they occurred
at a slower rate quarter-over-quarter.  The majority of the ISP
line churn can be attributed to Level 3 Communications, which
moved lines originally sold to Splitrock onto Level 3's own
network.  ISP gross lines installed during the quarter were
7,952, and ISP lines disconnected were 35,276, resulting in ISP
net line installs of (27,324).

Services - The rollout to all markets of Focal's Integrated
Voice and Data service, which allows for the provisioning of
both voice and data over a single dedicated circuit, was
completed in the second quarter.  IVAD is an attractive
alternative for branch offices of large companies and medium
sized enterprises from a cost savings perspective and because
customers have the flexibility of ordering from 12 to 24 voice
lines while maintaining the ability to scale up to 1.5 Mbps of
data capacity.

Markets -- Focal provides market specific information to provide
insight into the life-cycle performance of its markets.  The
following table presents the operating results for a group of
Focal's mature markets and its new markets for the three months
ended June 30, 2002.  Mature markets are defined as markets in
operation prior to January 1, 2000.  The Company's mature
markets are Chicago, New York, San Francisco, San Jose, Oakland,
Philadelphia, Washington DC, Northern Virginia, Los Angeles,
Orange County, Northern New Jersey, Boston, Detroit and Seattle.

                           Guidance

For the third quarter ending September 30, 2002, the Company
expects revenue of $85 to $87 million and EBITDA of a deficit of
$1 million to break even.  For the fourth quarter, the Company
expects revenue of $90 to $92 million and EBITDA of $4 to $5
million. The Company said it expects 2002 revenue of $354 to
$358 million, 2002 EBITDA of a deficit of $3.2 to a deficit of
$1.2 million and 2002 associated capital expenditures of
approximately $40 million.

Focal Communications Corporation -- http://www.focal.com-- is a  
leading national communications provider.  Focal offers a range
of solutions, including local phone and data services, to
communications-intensive customers.  Half of the Fortune 100 use
Focal's services, in 23 top U.S. markets.  Focal's common stock
is traded on the Nasdaq National Market under the symbol FCOM.

                           *    *    *

As reported in Troubled Company Reporter's June 28, 2002
edition,  Standard & Poor's assigned its triple-'C' bank loan
rating to integrated communications service provider Focal
Communications  Corp.'s senior secured credit facility and
assigned its double-'C' rating to the company's senior unsecured
debt. The company completed a comprehensive recapitalization
plan on October 26, 2001.

A triple-'C' corporate credit rating was also assigned to the
company. The outlook is developing. As of March 31, 2002,
Chicago, Illinois-based Focal had total debt outstanding of
about $477 million, including $103 million of convertible notes.
The company offers voice and data services to large enterprise
and Internet service provider (ISP) customers in 22 metropolitan
markets.

"The rating on Focal reflects the very high business risk
profile of the competitive local exchange carrier (CLEC)
industry and the company's weak financial position," Standard &
Poor's credit analyst Rosemarie Kalinowski said. "In addition,
ISPs represent about 40% of the company's revenue mix. Although
this percent has declined over the past few quarters, the
company has experienced a significant amount of line churn
because a good degree of ISPs continue to have financial
difficulties."


FRONTLINE COMMS: Second Quarter Net Loss Plummets 80% to $204K
--------------------------------------------------------------
Frontline Communications Corp., (AMEX: FNT) --
http://www.fcc.net-- announced financial results for the three  
months ended June 30, 2002.

The earnings before interest, taxes, depreciation and
amortization (EBITDA) for the three and six months ended June
30, 2002 were $6,698 and $9,791, respectively, compared to a
loss of $275,511 and $888,859, respectively, over the same
periods of prior year. Cost reductions accomplished through the
Company's restructuring efforts decreased the losses and enabled
the Company to report a positive EBITDA in 2002.

For the three months ended June 30, 2002, the net loss declined
by 80.3% to $204,616 compared to a net loss of $1,038,424 in
2001. For the three months ended June 30, 2002, after adjusting
for preferred stock dividends, the net loss available to common
shares was $280,051 compared to $1,117,399 in 2001. For the six
months ended June 30, 2002, the net loss declined by 82.8% to
$418,800 compared to a net loss of $2,430,622 in 2001. For the
six months ended June 30, 2002, after adjusting for preferred
stock dividends, the net loss available to common shares was
$573,300 compared to $2,593,402 in 2001.

Revenues for the three months ended June 30, 2002, decreased by
22.9% to $1,286,961 compared with revenues of $1,669,865 for the
three months ended June 30, 2001. Revenues for the six months
ended June 30, 2002, decreased by 21.4% to $2,639,230 compared
with revenues of $3,359,250 for the six months ended June 30,
2001.

Commenting on the results, Frontline CEO Stephen J. Cole-
Hatchard stated, "We continue to see the results of our
restructuring efforts, as evidenced by the 80% decline in net
loss. As in the first quarter, the drop in revenue was expected
because of the consolidation of offices and the fact that we did
not engage in any acquisition activities. However, we are now
focusing on our internal sales efforts, and are very excited
about our pending merger with Shecom Corporation, which will we
believe will add a significant revenue stream and increase our
critical mass".

Founded in 1995, Frontline Communications Corporation provides
high-quality Internet access and Web development and hosting
services to homes and businesses nationwide. Frontline offers
Ecommerce, programming, and Web development services through its
PlanetMedia group -- http://www.pnetmedia.com  

Frontline is headquartered in Pearl River, New York, and is
traded on the American Stock Exchange.

At March 31, 2002, Frontline Communications has a total
shareholders' equity deficit of about $1.4 million.


FRUIT OF THE LOOM: Trust Signing up Keen Realty as Auctioneer
-------------------------------------------------------------
The Fruit of the Loom, Ltd., Liquidation Trust owns parcels of
real property, including buildings, structures, and annexed
fixtures.  Risa M. Rosenberg, Esq., at Milbank, Tweed, Hadley &
McCloy, tells the Court that the Trust has decided to sell its
Non-Operating Real Properties through public auctions or private
sales.  To that end, the FOL Trust wants to retain a
professional auctioneer with experience and expertise.  The FOL
Trust believes it would be the most cost-effective and organized
method for soliciting offers and consummating the sale of the
Non-Operating Real Properties.

By this application, the FOL Trust seeks the Court's authority
to retain and employ Keen Realty as its auctioneer to:

    -- conduct the Auctions and sale of the Non-Operating
       Real Property, and

    -- provide additional related services as the FOL Trust
       may request from time to time.

According to Ms. Rosenberg, Keen was selected because it has:

    -- access to a nationwide network of potential buyers,

    -- resources to manage a large portfolio of properties, and

    -- significant experience in marketing industrial
       properties.

In accordance with FOL Trust's requirement, Keen also performed
substantial and costly due diligence on the Non-Operating Real
Properties prior to submitting proposals to act as auctioneer.  
The FOL Trust carefully considered Keen's proposal.  Keen's
impressive presentation later clinched the deal.

Ms. Rosenberg assures Judge Walsh that Keen has extensive
experience conducting industrial property auctions.  As
Auctioneer, Keen is expected to:

    (a) prepare the Non-Operating Real Properties to the extent
        necessary to induce buyers to submit bids;

    (b) furnish assistance that FOL Trust or its advisors may
        require to consummate the sale and transfer of the
        Non-Operating Real Properties for as high a price as
        possible;

    (c) retain the services of local brokers in each market,
        who will look solely to Keen for compensation;

    (d) supervise on-site inspections with the assistance of
        local brokers prior to the sale of any Real or
        Personal Property;

    (e) respond to and manage all pre-sale inquiries from
        prospective buyers of the Non-Operating Real
        Properties; and

    (f) additional related services as FOL Trust may request
        of the Auctioneer.

Keen will not be required to submit fee applications, but any
compensation disputes shall be submitted to this Court.  The
proposed terms of Keen's compensation provide for the payment of
premiums based on the sale of Non-Operating Real Properties --
not hourly rates. Therefore, Ms. Rosenberg contends, there is
minimal risk of duplication of efforts and costs to the estates.  
Keen will also seek reimbursement of all reasonable, necessary,
and documented out-of-pocket costs incurred in conducting the
Auctions or sale of the Non-Operating Real Properties.  FOL
Trust must approve each expense item in excess of $500 prior to
expenditure.

For time spent meeting with the Trust or its advisors in
connection with in-court and/or deposition testimony,
preparation for testimony, responding to discovery requests,
document review and preparation, and any and all related
meetings, Trust shall pay Keen on an hourly basis and reimburse
Keen for travel expenses.  Hourly fees do not apply to testimony
and court time on behalf of the Trust in support of Keen's
retention and resulting transactions.  Compensation shall be
earned at these hourly rates:

      Professional       Position         Hourly Rate
      ------------       --------         -----------
      Moe Bordwin        Chairman          $400
      Harold Bordwin     President          400
      Chris Mahoney      Vice President     300
      Craig Fox          Vice President     300
      Mike Matlat        Vice President     300
      Matt Bordwin       Vice President     300
      Susan Walkey       Associate          110
      Robert Tramantano  Associate          110
      Eric Leighton      Associate          110

The Auctions will be conducted during the fall of 2002.  In
connection with each sale of Real Property pursuant to an
Auction, Keen will charge:

    (1) a $20,000 advisory and consulting fee for the review
        of documents and development and implementation of a
        marketing strategy;

    (2) a 6% commission % of the Gross Proceeds, with the fee
        to be paid, in full, off the top, from the proceeds
        of sale or  simultaneously with the closing, sale,
        assignment or other consummation of the proposed
        transaction of any Real Property;

    (3) in connection with the sale of certain parcels of
        Real Property, in the event the successful purchaser
        shall have been represented by a buyer's broker, the
        total commission shall be increased to 9.0% of the
        Gross Proceeds; and

    (4) in the event that FOL Trust signs a binding sales
        contract for both the St. Martinville, Louisiana and
        Frankfort, Kentucky locations, either separately or
        combined, within 120 days of the Effective Date and
        closing for both properties takes place within the
        earlier of December 31, 2002 or 60 days following the
        execution of the second sales contract, Keen will earn
        a bonus equal to an additional 1% on the aggregate
        Gross Proceeds for all Non-Operating Real Estate
        Properties.

Keen Realty Vice President Mathew Bordwin assures the Court that
the firm is a "disinterested person" as defined in Section 101
and used in Section 327 of the bankruptcy Code. (Fruit of the
Loom Bankruptcy News, Issue No. 58; Bankruptcy Creditors'
Service, Inc., 609/392-0900)   


FUELNATION: Preparing to Issue $330MM Taxable Municipal Bonds
-------------------------------------------------------------
On July 29, 2002, FuelNation entered into a letter agreement
with Shaikh Isa Mohammed Isa Alkhalifa, a director of the
Company, to provide a cost of issuance and shortfall letter of
credit for the Company's proposed $330 million taxable municipal
bond issue in amounts equal to approximately 3.5% (three and one
half percent) of the bond amount for a total of approximately
$10,500,000 in three installments of approximately $3,500,000.

FuelNation will issue a taxable Municipal Bond Issue in the
amount of $330,000,000 USD in three series, A,B,C of
approximately $110,000,000 each, for the purpose of developing a
public purpose travel and transportation center in Davie,
Florida and the acquisition and consolidation of five petroleum
marketers/petroleum transporters and centralize the acquisitions
with automation and tracking of petroleum from the state of
Ohio. FuelNation will use a Public Agency, as defined in Chapter
163, Florida Statutes for the bond issuance with an interlocal
agreement between a public agency in Ohio and Florida.

As reported in Troubled Company Reporter's July 4, 2002,
edition, the Rosen Law Firm -- http://www.rosenlegal.com--  
filed a lawsuit on behalf of a purchaser of a convertible  
promissory note of FuelNation, Inc. (OTC BB:FLNT.OB).

The lawsuit alleges that FuelNation failed to pay interest on
the note when due. The noteholder subsequently declared
FuelNation in default on the note and has demanded full payment
of the principal and interest owed thereon. The complaint titled
Gianoukas v. FuelNation, Inc., was filed on June 21, 2002 in the
Superior Court of New Jersey, County of Hudson.


GLENOIT CORP: Wants Until Nov. 6 to Make Lease-Related Decisions
----------------------------------------------------------------
Glenoit Corporation and its debtor-affiliates ask the U.S.
Bankruptcy Court for the District of Delaware for more time to
decide whether to assume, assume and assign, or reject their
unexpired nonredidential real property leases.  The Debtors want
the deadline for these decisions to be extended through
November 6, 2002.

The Debtors, with the assistance of their professionals and the
support of many of their creditors, are examining and seeking
various alternatives to allow them to dispose of their divisions
as going concerns or emergence from chapter 11. The Debtors are
currently in the process of selling both American Pacific
Enterprises, Inc. and their Specialty Fabrics Division.  

The ability to assume or reject the Leases is highly beneficial
during this time. The Debtors have filed a plan that they
anticipate to prosecute within the next two to three months. As
a result, the Debtors require the continued flexibility of
Section 365, including further extension of the Lease Decision
Period.

Headquartered in New York City, Glenoit Corporation is a
domestic manufacturer of small rugs, knit pile fabrics and an
importer and manufacturer of home products such as quilts,
comforters, shams, shower curtains, table linens, pillows and
pillowcases with operations in North Carolina, Ohio, California
and Canada. The Company filed for Chapter 11 protection on
August 8, 2000. Joel A. Waite, Esq., at Young, Conaway, Stargatt
& Taylor represents the Debtors in their restructuring efforts.


GLOBAL CROSSING: Implements Matrix Internet Performance System
--------------------------------------------------------------
Global Crossing has completed the initial implementation of an
IP network performance monitoring system provided by Matrix
NetSystems, an independent Internet performance measurement,
management and optimization services company.  Matrix NetSystems
provides a comprehensive verification system of Best Practices
that measures, analyzes and identifies Internet performance
based on key metrics including packet loss, latency and
reachability.

Using the industry's leading IP network performance measurement
tools, Global Crossing is able to verify that it is achieving
the highest possible reliability and consistency standards for
its customers worldwide.  Global Crossing owns and operates a
worldwide IP network that provides connectivity to over 200
cities in 27 countries around the globe.

Global Crossing's network offers leading IP voice and data
networking solutions, supporting mission critical applications
and data services for carriers, ISPs, research and education
networks and the world's leading corporations.

"We are proud of the industry-leading global IP network Global
Crossing has built and operates," said John Legere, Global
Crossing chief executive officer.  "By applying the rigorous
network monitoring tools provided by Matrix NetSystems, we
continue to deliver the highest levels of service to our
customers."

Even as IP data and voice traffic volumes continue to grow,
Global Crossing consistently achieves sustained network
availability levels of 99.999%, the industry's highest standard.  
In early July, Global Crossing announced that IP data traffic
transported over its worldwide network is increasing at an
annualized rate of approximately 400%.

"As Global Crossing manages its restructuring, it has been
generating industry-leading network performance metrics while
taking on an increased IP traffic load.  In fact, during the
past six months, Global Crossing's network has improved upon its
already top-tier results for key metrics including packet loss
and reachability," said Bill Palumbo, CEO of Matrix NetSystems.
"By employing Matrix NetSystems products and services, Global
Crossing has the right measurement and management strategy in
place to provide a solid foundation for broader end-to-end
performance service level agreements. Matrix enables Global
Crossing to provide its customers the very best possible
performance."

Having monitored the Internet since the early 1990s, Matrix
NetSystems' neutral view of network performance allows Global
Crossing the intelligence and the tools to increase IP network
transparency for its customers. Advantages for customers include
the ability to monitor IP network end-to-end performance metrics
and trends in real-time, identify possible anomalies, and ensure
network optimization while benchmarking against the performance
of other networks.

"The Internet is a fluid, changing network that performs best
when all of its parts are monitored and critically evaluated
against a baseline expectation of performance," said Bill
Palumbo, "Our service is the only one capable of giving a
complete view of the Internet, whether providing insight into
the Internet's health globally, even identifying issues
associated with a problematic router."

Formed in 1990 (as MIDS) Matrix NetSystems was the first
organization to record Internet performance data, as well as
create a daily topology and ISP ratings --  
http://ratings.matrixnetsystems.com-- that are cited the world  
over.  The Austin, Texas-based business is harnessing its decade
of intellectual capital and productizing it to solve today's
Internet-related issues.  Today the company offers Matrix
Insight, a managed Internet performance measurement service.


GOLF AMERICA: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Golf America Stores, Inc.
        10001 Franklin Square Drive, Suite G
        Baltimore, MD 21236

Bankruptcy Case No.: 02-12313

Chapter 11 Petition Date: August 7, 2002

Court: District of Delaware (Delaware)

Judge: Peter J. Walsh

Debtor's Counsel: M. Blake Cleary, Esq.
                  Young Conaway Stargatt & Taylor, LLP
                  1000 West Street, 17th Floor
                  P. O. Box 391
                  Wilmington, DE 19899-0391
                  302-571-6600
                  Fax : 302-571-1253

                  and

                  Paul M. Nussbaum, Esq.
                  Martin T. Fletcher, Esq.
                  Whiteford, Taylor & Preston L.L.P.  
                  7 Saint Paul Street
                  Baltimore, Maryland 21202-1626
                  Telephone: 410-347-8700
                  Fax: 410-752-7092  

Estimated Assets: $1 to $50 Million

Estimated Debts: $1 to $50 Million

Debtor's 20 Largest Unsecured Creditors:

Entity                     Nature of Claim        Claim Amount
------                     ---------------        ------------
Ashworth                   Trade Debt               $4,504,072  
2755 Loker Ave. West
Carlsbard, GA 92008

Greg Norman                Trade Debt                 $991,314
PO Box CS 100256
Atlantis, GA 30384-0258

Polo                       Trade Debt                 $718,547
PO Box 591 GPO
New York, NY 10087-5091

Bobby Jones                Trade Debt                 $616,994
PO Box 93968
Chicago, IL 60673

Culler & Buck              Trade Debt                 $560,025
PO Box 34733
Seattle, WA 96124

Supreme International      Trade Debt                 $335,589
3000 NW 107 Ave.
Miami, FL 33172

Tommy Hilfiger             Trade Debt                 $321,960
222 Piedmont Ave. NE
Atlanta, GA 30308

G.E.A.R.                   Trade Debt                 $206,599

Nicklaus                   Trade Debt                 $189,503

Sun Mountain               Trade Debt                 $188,271

Hugo Boss                  Trade Debt                 $183,635

Dunlop Slazenger Group     Trade Debt                 $181,210

Axle Clothing Corporation  Trade Debt                 $163,445

Roche Golf                 Trade Debt                 $131,328

Oakley                     Trade Debt                 $127,973

Forresters                 Trade Debt                 $126,662

Taylor Made-Adidas Golf    Trade Debt                 $123,237

Foot-Joy                   Trade Debt                 $120,229

Avid/Attorney Recovery     Trade Debt                 $110,562
Sys., Inc.  

Dynamic Design Enterprises Trade Debt                 $105,875


HAYES LEMMERZ: Wants to Keep Exclusivity Until January 15, 2003
---------------------------------------------------------------
According to Anthony W. Clark, Esq., at Skadden Arps Slate
Meagher & Flom LLP in Wilmington, Delaware, Hayes Lemmerz
International, Inc., and its debtor-affiliates need more time
to:

    -- complete, present, and implement their 5-year business
       plan,

    -- assess the 2002 operating results, and

    -- formulate, propose, and solicit acceptances to a plan of
       reorganization.

From the outset of these Chapter 11 cases, Mr. Clark points out
that the Debtors prioritized their goals to stabilize their
business operations in 2002 and formulate a five-year business
plan, which would be the basis for their emergence from
bankruptcy.  "This process is well underway," Mr. Clark says.

Mr. Clark notes that a new senior management team has been put
in place.  The Debtors have nearly completed their 5-year
business plan, which they will present to the Creditors'
Committee and their Prepetition and Postpetition Lenders before
August 12, 2002.  The Debtors, as well as the Committee and the
Prepetition and Postpetition Lenders, also have begun the
process of valuing the Debtors' business.  "Once these processes
are complete, the Debtors and their principal constituents will
be in a better position to formulate and negotiate the terms of
a plan of reorganization," Mr. Clark says.

By this motion, the Debtors ask the Court to extend their
exclusive period to file a plan of reorganization until January
15, 2003 and their exclusive period to solicit acceptances to
that plan until March 14, 2003.

Mr. Clark argues that there are two other factors that support
the Debtors' request for an extension of the Exclusive Periods:

    -- the competitive situation of the Debtors' industry, and

    -- the claims process in these chapter 11 cases.

According to Mr. Clark, the Debtors have a few very large
customers that are closely following these cases.  Mr. Clark
asserts that an extension of the Exclusive Periods will:

    (a) provide a signal to these customers that the Court and
        the principal constituents in these cases have
        confidence in the Debtors' reorganization efforts thus
        far, and

    (b) recognize the significant achievements the Debtors have
        accomplished towards rehabilitation.

Moreover, Mr. Clark notes that the claims bar date in these
cases only recently passed.  Creditors filed over 5,000 claims
in these cases.  The Debtors are performing their claims
analysis and reconciliation and have already filed objections to
some of the claims.  But given the number of claims filed, Mr.
Clark says, the Debtors need more time to complete their
analysis and reconciliation.  And given the Court-imposed
"black-out" period in connection with plan solicitation during
which the Debtors may not object to claims, Mr. Clark adds, an
extension of the Exclusive Periods will allow the Debtors to
move their claims analysis significantly forward.

                Debtors' Cases Are Large And Complex

Mr. Clark further argues that the Debtors' cases are large and
complex.  The Debtors are the world's largest manufacturer of
automotive wheels with an estimated global market share of 20%
and a leading supplier of brakes and suspension components to
the global automotive and commercial highway markets with a
presence in 17 countries.  The Debtors' global operations cover
25 facilities in North America, 20 manufacturing facilities in
Europe, and five manufacturing facilities in South America,
Asia, and South Africa.  The Debtors and their affiliates also
employ over 10,000 employees on a global basis.

Mr. Clark continues that the Debtors' operations include
numerous divisions with a broad array of products and customers,
including these original equipment manufacturers: General
Motors, Ford, Daimler-Chrysler, BMW, Volkswagen, Nissan, and
Honda, among others.  In 1999, the Debtors acquired CMI
International, a leading full-service supplier of wheel-end
attachments, aluminum structural components, and powertrain
components to the automotive industry, further expanding the
Debtors' overall operations.

Given the sheer size and complexity of the Debtors' operations,
Mr. Clark asserts that cause exists to further extend the
Exclusive Periods.

                 Business Plan Must Be Finalized

"Compelling the Debtors to file a plan of reorganization before
completing this revised business plan may promote an uninformed
and speculative negotiation process," Mr. Clark says.  Besides,
to complete the valuation of the Debtors' businesses going
forward, the business plan must first be finalized.

In addition, Mr. Clark relates, the Debtors have undertaken
various cost-reduction measures, including the rejection of
certain unnecessary executory contracts and leases of
nonresidential real estate.

                   Progress In Reorganization

The Debtors' operating results, which continue to exceed
projections, show the Debtors' progress toward reorganization.
In January and February, the Debtors had a consolidated EBITDA
of $34,100,000, as compared to an initial plan projection of
$21,900,000, a favorable variance of 56%.  To date, Mr. Clark
notes, the Debtors' consolidated EBITDA has continued to surpass
initial projections.  While a final business plan is still being
formulated, the Debtors can comfortably state that they:

    -- have met and continue to exceed their initial 2002 goals,
       and

    -- are significantly ahead of their bank covenants.

Combined with other significant achievements during 2002, the
Debtors believe they are well-positioned to formulate their
five-year business plan and implement a successful
reorganization strategy generally consistent with the timetable
presented at the outset of these Chapter 11 reorganization
cases.

Other indications of a successful stabilization of the Debtors'
business include, strong liquidity in the first part of 2002.
Mr. Clark notes that the Debtors continue to have a small
outstanding funded balance under their DIP loan facility, and
their liquidity is significantly better than initially
projected. "These positive operating results are attributable to
the Debtors' strong performance in planning and disciplined cash
management," Mr. Clark says.

Trade terms, another key source of liquidity and display of
vendor confidence, also have improved steadily over the course
of these cases.  Mr. Clark admits that vendor relations
initially were strained as a result of the filing of these
cases.  The Debtors have continued to systemically pursue the
restoration of normalized trade terms by periodically meeting
with various vendors and keeping them apprised of the Debtors'
restructuring efforts.  The Debtors have made significant
progress in resolving reclamation claims and other related
matters.  The Debtors reconciled reclamation claims from an
original asserted aggregate amount of $9,600,000 to $1,900,000.

Mr. Clark assures the Court that the Debtors' request for an
extension of the Exclusive Periods is not a negotiation tactic,
but merely a reflection of the fact that these cases still are
not ripe for the formulation and confirmation of a viable plan
of reorganization.  However, unlike most situations, the Debtors
are seeking the extension because of the positive financial
results they are achieving.  The extension of exclusivity is
necessary to properly incorporate these results into the five-
year business plan, the valuation of the Debtors' businesses,
and the structure of the plan of reorganization.

Mr. Clark asserts that the requested extension of the Exclusive
Periods will not prejudice the interests of any creditor, as the
Debtors have timely met, and continue to timely meet, their
postpetition obligations in these cases.  This fact alone
supports the Debtors' requested extension of the Exclusive
Periods. (Hayes Lemmerz Bankruptcy News, Issue No. 15;
Bankruptcy Creditors' Service, Inc., 609/392-0900)

Hayes Lemmerz Int'l Inc.'s 11.875% bonds due 2006 (HLMM06USS1),
DebtTraders reports, are trading at 67 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=HLMM06USS1
for real-time bond pricing.


ICG COMMS: Asks Court to Approve Supplemental Plan Disclosure
-------------------------------------------------------------
ICG Communications Inc., and its debtor-affiliates ask Judge
Walsh to approve:

    (1) their Supplemental Disclosures with respect to
        their Second Amended Joint Plan of Reorganization,
        as modified,

    (2) solicitation procedures for confirmation with respect
        to the Plan as modified, and

    (3) the form and manner of notice of the Supplemental
        Disclosure Statement hearing.

The Debtors explain that the previously confirmed Plan contained
certain conditions precedent to consummation, including closing
by Reorganized ICG on transactions that were to provide
$65,000,000 of new financing on the Effective Date, led by
Cerberus Capital Management, LP.  After entry of the
confirmation order, but prior to the Effective Date, CCM took
the position that it was not obligated to close the Old Exit
Financing transaction as a result of a Material Adverse Change
and a Financial Markets Disruption.  The Debtors disputed CCM's
assertions, but CCM refused to close.

CCM also requested the inclusion of additional covenants in the
Initial Exit Financing and asserted that these covenants were
customary and contemplated by the original Plan and CCM's
commitment letter, and necessary because of the Debtors' recent
operating results and CCM's belief that a Material Adverse
Change and a Financial Markets Disruption had occurred.  The
Debtors disagreed with all of that, and believed that the
inclusion of these covenants would result in a significant
change to the economics described in the original Disclosure
Statement, placing the Debtors in contravention of the Plan as
confirmed.

In consultation with the Official Committee of Unsecured
Creditors and their prepetition senior secured lenders, the
Debtors determined that reaching a compromise with CCM was more
advantageous to the estates and their stakeholders than pursuing
litigation remedies.  A settlement with CCM was reached, which
was supported by the Creditors' Committee and the Prepetition
Secured Lenders.  This settlement includes ongoing provision of
some -- albeit reduced -- exit financing.  The settlement
requires certain modifications to the Plan, and the Debtors
believe that the modifications are sufficiently material to
require the re-solicitation of acceptances of the Plan as
modified.  If the Plan as modified is confirmed, the Debtors
will be able to emerge from Chapter 11 as a going concern.

ICG believes it can re-solicit creditors' votes by the end of
September, paving the way for an October Effective Date and
ICG's emergence from Chapter 11.

The deadline for objections is August 15, 2002.  The Debtors
have obtained an August 23, 2002 hearing date, during which
Judge Walsh will consider the adequacy of the Supplement and to
set a date for a hearing on confirmation.

     No Packages To Non-Voting Claims and Interest Holders

Timothy R. Pohl, Esq., at Skadden, Arps, Slate, Meagher & Flom,
in Chicago, Illinois, relates that the Debtors intend to re-
solicit votes on the Modified Plan from voting classes under the
procedures approved in connection with the Initial Disclosure
Statement Order.  In addition, the Debtors ask Judge Walsh not
to require them to send out the various notices to other parties
like the holders of unimpaired claims, claims not entitled to
vote, or interest holders.  The Modified Plan has not changed
with respect to any of these parties, Mr. Pohl points out.  The
Debtors propose, instead, to publish a notice of the Second
Confirmation Hearing and the deadline for objecting to the Plan.

                      Adequacy of Supplement

The Debtors ask Judge Walsh to approve the Supplement because it
provides adequate information within the meaning of Section
1125(a)(1) of the Bankruptcy Code.  "Adequate information" is
information of a kind, and in sufficient detail, as far as is
reasonably practicable in light of the nature and history of the
debtor and the condition of the debtor's books and records, that
would enable a hypothetical reasonable investor typical of
holders of claims or interests of the relevant class to make an
informed judgment about the plan.

The Supplement contains descriptions and summaries of, among
other things:

    (a) the Modification,

    (b) certain events leading up to the Modification,

    (c) the effect of the Modification on the distributions
        to holders of claims entitled to distributions to be
        issued under the Modified Plan,

    (d) updated valuation information in light of the
        Modification that is relevant to the determination
        by holders of claims in Classes H-3, H-4, S-3, S-4
        and S-5 whether to accept or reject the Modified
        Plan, and

    (e) revised financial projections for the Reorganized
        Debtors.

                  Transmittal to Voting Creditors

The Debtors further seek the Court's authority to mail the
proposed Modification (without the voluminous exhibits), the
Supplement, and appropriate Ballots to the Classes of Claims
that are entitled to vote on the Modified Plan, as set forth in
the Initial Disclosure Statement Order and under substantially
the same procedures.  Holders of Claims in Classes H0-3, H-4, S-
3, S-4 and S-5 will be afforded the opportunity to cast
acceptances or rejections of the Modified Plan, by submitting
new ballots so as to be received by the Voting Agent by the new
voting deadline to be established by Judge Walsh.

Under the circumstances of these Chapter 11 cases, Mr. Pohl
says, mailing the hearing notice to the tens of thousands of
creditors and equity security holders is extremely
impracticable, costly and unnecessary.  The Debtors notify the
Court that they have delivered a copy of the Supplement to:

    (1) the United States Trustee,

    (2) the Securities and Exchange Commission,

    (3) the Office of the United States Attorney for the
        District of Delaware,

    (4) the Internal Revenue Service,

    (5) counsel for the Debtors' prepetition and postpetition
        secured lenders,

    (6) counsel for the Official Committees, and

    (7) the 2002 list.

The Debtors have also posted the Supplement on the ICG Web site  
at:

    http://www.icgcomm.com

The Debtors will publish the Supplement Disclosure Statement
Hearing Notice in the national edition of The Wall Street
Journal and the Denver Post as soon as possible.  The Debtors
contend that this is sufficient notice, especially since the
Supplement has already been reviewed and approved by counsel to
the Creditors' Committee, counsel to the Prepetition Lenders,
and counsel to the lenders under the New Exit Financing. (ICG
Communications Bankruptcy News, Issue No. 28; Bankruptcy
Creditors' Service, Inc., 609/392-0900)  

ICG Services Inc.'s 13.50% bonds due 2005 (ICGX05USR1) are
trading at 4.5 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=ICGX05USR1
for real-time bond pricing.


ITC DELTACOM: Turns to Deloitte & Touche for Financial Advice
-------------------------------------------------------------
ITC DeltaCom, Inc., asks the U.S. Bankruptcy Court for the
District of Delaware for permission to retain Deloitte & Touche
LLP as accountants and financial advisors.  The Debtor tells the
Court that Deloitte & Touche is well qualified to serve as its
restructuring advisors since Deloitte & Touche is knowledgeable
on its business and financial affairs.

Deloitte & Touche will:

     a) provide assistance and oversight in collecting,
        analyzing and presenting accounting, financial and other
        information required in a chapter 11 proceeding; more
        particularly, as requested by management, provide advice
        and assistance to the Debtor's personnel in preparing
        the lists of creditors, the statement of financial
        affairs, and schedules of assets and liabilities;

     b) provide assistance in evaluating reorganization
        strategies and alternatives available to the Debtor;

     c) provide information related to other telecommunication
        reorganizations to determine other exit and confirmation
        strategies employed and best practices;

     d) consult with and assist the Debtor's personnel with
        post-petition financial reporting requirements,
        including but not limited to providing advice regarding
        management's preparation of monthly operating reports.

     e) consult with and assist the Debtor's personnel regarding           
        issues specific to companies in bankruptcy, including,
        as requested, preparation of a liquidation analysis or
        its compliance with the requirements of SOP 90-7
        :Financial Reporting by Entities in Reorganization Under
        the Bankruptcy Code."

     f) provide assistance in the preparation of potential
        employee retention and severance plans.

     g) provide assistance and oversight with reconciling the
        schedules of assets and liabilities to creditor proofs
        of claim; assist with the preparation of objections to
        proofs of claim;

     h) provide assistance in analysis of assumption and
        rejection issues regarding executory contracts and
        leases and the computation of 502(b)(6) treatment;

     i) attend and advise at meeting with the Official Committee
        of Unsecured Creditors and its counsel and
        representatives or with the Senior Secured Lenders,
        their counsel and representatives;

     j) coordinate responses to creditors and other party
        requests for information, including assembling,
        organizing and referencing financial and corporate
        documents for the various constituents' financial
        advisors;

     k) render expert testimony on behalf of the Debtor, which
        may include issues requisite to plan confirmation such
        as best interests test and feasibility;

     l) perform other services the Debtor may request.

Deloitte & Touche's customary hourly rates are:

          Partner                      $405 - $475
          Senior Manager & Manager     $300 - $400
          Senior Staff                 $200 - $300

ITC Delatacom, Inc., an exempt telecommunications company and a
holding company, filed for chapter 11 protection on June 25,
2002. Rebecca L. Booth, Esq., Mark D. Collins, Esq., at
Richards, Layton & Finger, P.A., and Martin N. Flics, Esq.,
Roland Young, Esq., at Latham & Watkins represent the Debtors in
their restructuring efforts. When the Company filed for
protection from its creditors, it listed $444,891,574 in total
assets and $532,381,977 in total debts.


INACOM INC: Court Okays Werb & Sullivan as Avoidance Counsel
------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware gave its
stamp of approval to Inacom Corp., and its debtor-affiliates to
sign-in Werb & Sullivan as special Delaware Cousnel in
connection with prosecuting on behalf of Debtors possible
avoidance actions against [unnamed] professionals under Chapter
5 of the Bankruptcy Code.

The Court determined that Werb & Sullivan:

     a) does not have any connection with any Debtors, their
        affiliates, their creditors, the U.S. Trustee, any
        person employed in the office of U.S. Trustee, or any
        other party in interest, or their respective attorneys
        and accountants;

     b) is a "disinterested person" as defined in the Bankruptcy
        Code, and

     c) does not hold or represent any interest adverse to the
        estates with respect to the matters on which the Firm is
        employed.

Werb & Sullivan will charge hourly rates:

     Duane D. Werb            Partner           $395 per hour
     Joseph V. Bongiorno      Senior Law Clerk  $135 per hour
     Jennifer H. Unhoch       Law Clerk         $110 per hour
     Jonathan B. O'Neill      Law Clerk         $110 per hour
     Janet R. Corbett         Paralegal         $ 95 per hour

Inacom Corp., providers of information technology products and
technology management services, filed for Chapter 11 petition on
June 16, 2000. Laura Davis Jones, Esq., and Christopher James
Lhulier, Esq., at Pachulski Stang Ziehl Young & Jones PC
represent the Debtors in their restructuring efforts.


INTEGRATED HEALTH: Rotech Wants More Time to Challenge Claims
-------------------------------------------------------------
Under the Rotech Plan, the deadline to file objections to claims
was July 24, 2002.  The Reorganized Rotech Debtors ask the Court
to extend this period through and including October 22, 2002.

The Reorganized Rotech Debtors tell the Court they have
undertaken substantial efforts to date in evaluating and
objecting to most of the Claims filed against them.  
Specifically, the Reorganized Rotech Debtors have filed 14
omnibus objections to Claims with respect to both the Rotech and
IHS debtors.  Rotech relates that many of the Claims that are
actually against Rotech were filed against IHS or a different
debtor as a result of the joint administration of cases.  The
Reorganized Rotech Debtors report that the reconciliation
process is substantially complete.  But they believe that an
extension of the Claims Objection Deadline is proper, out of an
abundance of caution.

Pursuant to Delaware Bankruptcy Rule 9006-2, the Claims
Objection Deadline is automatically extended until the Court
rules on the motion.  The Court will convene a hearing on
Rotech's request on August 13, 2002. (Integrated Health
Bankruptcy News, Issue No. 40; Bankruptcy Creditors' Service,
Inc., 609/392-0900)   


KAISER ALUMINUM: Gilbert Heintz Agrees to Revise Engagement Fees
----------------------------------------------------------------
On behalf of Acting U.S Trustee Donald F. Walton, Frank J.
Perch, III, Esq., argues that Kaiser Aluminum Corporation and
its debtor-affiliates have not demonstrated the necessity or
reasonableness of hiring a fifth law firm -- in addition to the
four experienced and highly competent (and costly) firms they
have already retained for reorganization and asbestos-related
issues.  Gilbert Heintz would be the third Section 327(a)
counsel to be employed by the Debtors, the others being Richards
Layton and Jones Day.  In addition, the Debtors have retained
two other firms under Section 327(e) for asbestos-related
issues, Heller Ehrman and Wharton Levin.

"The fact that Debtors have attempted to parcel out distinct
tasks to each firm does not demonstrate that the services of
Gilbert Heintz will not be duplicative," Mr. Perch points out.
"Rather, it demonstrates that in order to create the perception
that the firms will not overlap, the Debtors have had to divide
the work of the case into unnaturally small segments."

Mr. Perch contends that this fractionated approach will
necessarily lead to inefficiency and overstaffing in the effort
to coordinate the work of five different law firms.  Moreover,
notwithstanding the Debtors' attempts to create a division of
labor, it appears that two firms -- Heller Ehrman and Gilbert
Heintz -- will work on insurance coverage issues.

"The Debtors should be required either to withdraw this
application or to terminate the services of at least one of the
other four firms upon approval of Gilbert Heintz's retention,
and consolidate the various functions into a smaller group of
firms," Mr. Perch suggests.

Mr. Perch notes that the proposed compensation structure fixes
the minimum monthly compensation of Gilbert Heintz at $65,000
while allowing Gilbert to receive additional compensation if the
value of their billings at their normal rates exceeds $65,000.
This arrangement unreasonably restricts the Debtors and prevents
them from managing and minimizing costs, and may result in
grossly overcompensating Gilbert.  If Gilbert is retained at
all, their compensation should be based on a "lodestar" standard
alone under Sections 327 and 330 of the Bankruptcy Code.

With Gilbert Heintz' representation of certain asbestos
claimants in insurance coverage issues, Mr. Perch speculates
that there may be a conflict between the positions taken by
plaintiffs/claimants and the positions taken by
defendants/policyholders, like the Debtors, as to the
interpretation and application of insurance policy provisions.  
These insurance policy provisions are standard forms and, thus,
are likely to exist in the other matters in which Gilbert Heintz
represents claimants.  In addition, the Application and
Affidavit do not indicate whether these conflicting
representations have been disclosed to the claimant clients or
whether any consents or conflict waivers have been obtained.

"Gilbert Heintz may, as a result, be in a position where it is
seeking rulings on behalf of claimants that would be adverse
precedent to its policyholder clients, and vice versa," Mr.
Perch maintains.  "Therefore, Gilbert Heintz may not be
disinterested or may represent an adverse interest as to the
subject matter of the representation."

                          Debtors Reply

According to Patrick M. Leathem, Esq., at Richards, Layton &
Finger P.A., in Wilmington, Delaware, the Debtors and Gilbert
Heintz are currently in discussions with the US Trustee
regarding the resolution of the US Trustee's concerns.  As a
solution to any issue regarding the proposed compensation
structure, Gilbert Heintz has already agreed to convert its
billing management to customary hourly rate basis as requested
by the US Trustee.

"Gilbert Heintz is also discussing with the US Trustee better
defining scope of its work to address the US Trustee's other
concerns.  The Debtors remain hopeful that the US Trustee's
concerns can be resolved prior to the hearing of the motion,"
Mr. Leathem says.

If, however, the US Trustee' concerns cannot be resolved, the
Debtors contend that the US Trustee' objection should be
overruled since, contrary to the US Trustee's assertions, the
services provided by the firm will not conflict with, or be
duplicative of, the services provided by other professionals.

Mr. Leathem claims that Gilbert Heintz's retention will not
necessitate that the work be divided into "unnaturally small
segments" that will "lead to inefficiency and overstaffing".  To
the contrary, the division of responsibilities enables the
Debtors to benefit from the unique expertise each of these
professionals brings to the task of achieving a workable overall
resolution in these cases.

Mr. Leathem also contends that the US Trustee's concerns over a
potential conflict of interest created by the fact that Gilbert
Heintz represents asbestos claimants in other cases on insurance
matters are unfounded.  Gilbert Heintz' goal in representing
claimants in other cases and the Debtors in these cases is
completely consistent because, in both types of representations,
the firm is concerned with maximizing the amount of available
insurance coverage from the carrier.

"Moreover, as the Court is likely aware, Gilbert Heintz is and
has been involved in several bankruptcy cases in the same
capacity as in this case.  Those courts obviously did not
conclude that Gilbert Heintz's representation of asbestos
claimants in other cases created an adverse interest or resulted
in a lack of disinterestedness," according to Mr. Leathem.
(Kaiser Bankruptcy News, Issue No. 12; Bankruptcy Creditors'
Service, Inc., 609/392-0900)   

Kaiser Aluminum & Chemicals' 12.75% bonds due 2003 (KLU03USR1)
are trading at about 17. For real-time bond pricing, see
http://www.debttraders.com/price.cfm?dt_sec_ticker=KLU03USR1


KMART CORP: Court Okays Erwin Katz to Perform Mediation Services
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois
authorizes Kmart Corporation and its debtor-affiliates to employ
one-time bankruptcy Judge Erwin I. Katz to perform mediation
services.  As a condition to his retention, Mr. Katz must
dispose the Kmart 12.50% debentures due March 2005, which he and
his wife jointly own.  The disposition may be conducted through
a transfer to Mr. Katz' son, or through a sale.

Pursuant to the Claims Resolution Procedures, Mr. Katz will fill
two key roles:

    (1) administer the mediation process for the Judgment
        Claims; and

    (2) serve as mediator in certain larger and more complex
        mediations as may be requested by the parties.

In administering the mediation process, Mr. Katz will appoint
individual mediators in each case in his sole discretion with
the Debtors' input and advice, provided that there shall be a
preference for mediators located in and around the Detroit,
Michigan metropolitan area in order to reduce expenses to the
estate. Furthermore, Mr. Katz will also work with personnel from
Kmart and Kmart's third-party claims administrator, Sedgwick
Claims Management Services, in coordinating the scheduling of
all mediations, tracking their progress, and reporting to the
Court on the status and progress of implementation of the Claims
Resolution Procedures, including at the omnibus hearing
scheduled for October 2002.

Some of Kmart's larger and more complex Judgment Claims will
need the extensive judicial and mediation experience of Mr.
Katz, including those cases that:

    (a) involve difficult questions of liability, that raise
        inter-related non-tort issues, or

    (b) have been subject of protracted and difficult
        litigation.

The Debtors have agreed to compensate Mr. Katz at a rate equal
to:

    (1) $4,000 per day, plus expenses, for his services as
        mediator for mediations that take place in Chicago,
        Illinois;

    (2) $5,000 per day, plus expenses, for his services as
        mediator for mediations that take place in locations
        other than Chicago, Illinois; and

    (3) $500 per hour for all other hourly services, including
        as mediation administrator and preparation for
        mediations.

Mr. Katz will also receive a $5,000 retainer. (Kmart Bankruptcy
News, Issue No. 29; Bankruptcy Creditors' Service, Inc.,
609/392-0900)   


KMART CORP: Gets Green Light to Sell Cessna Aircraft to Shamrock
----------------------------------------------------------------
Kmart Corporation and its debtor-affiliates obtained permission
from the U.S. Bankruptcy Court for the Northern District of
Illinois to sell their 1985 Raytheon Beechjet 400 to
Shamrock Equipment Company, Inc.

After the Debtors, their legal and financial advisors, evaluated
the terms of each proposal, Shamrock Equipment Company Inc., was
declared the highest and best offer for the Property.

The salient terms of the Purchase Agreement between the Debtors
and Shamrock are:

Purchase Price:  $2,150,000

Escrow Deposit:  $50,000

Assets Included: All Debtors' rights, title and interest in
                 the Aircraft

Closing:         The latest to occur of:

                 (1) approval of the Proposed Sale by the Court;
                 (2) completion of the Pre-Purchase Inspection;
                 (3) closing of the Escrow Deposit; and
                 (4) payment of the Purchase Price.
(Kmart Bankruptcy News, Issue No. 29; Bankruptcy Creditors'
Service, Inc., 609/392-0900)

Kmart Corp.'s 9.0% bonds due 2003 (KM03USR6), DebtTraders
reports, are trading at 30 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=KM03USR6for  
real-time bond pricing.


KNOWLES ELECTRONICS: June 30 Balance Sheet Upside-Down by $485MM
----------------------------------------------------------------
Knowles Electronics Holdings Inc., announced its results for the
quarter ended June 30 and the first six months of 2002.

The manufacturer of hearing aid components and other products
reported second quarter sales of $58.2 million, 2% more than the
$57.3 million reported for the second quarter of 2001. The
company's sales for the first six months of 2002 totaled $109.2
million, 3% less than the $112.0 million reported for the first
half of 2001.

All three of the company's divisions reported increased sales
compared to the first quarter of the year. At the company's
Knowles Electronics Division, sales grew by 9% over the first
quarter to $34.6 million, 1% less than the $35.1 million
reported for the second quarter of 2001. The company's Emkay
Division reported sales of $10.7 million, an increase of 42%
over first quarter sales and 14% more than the $9.4 million
reported for the second quarter of 2001, due to strong demand
for its components, infrared products and finished goods. The
company's Automotive Components Group reported sales of $13.0
million for the second quarter of 2002, compared to sales of
$11.7 million for the first quarter of the year and $12.8
million for the second quarter of 2001.

Despite the quarter-to-quarter increase in sales, the company
reported a decline in sales for the six months. For the first
half of 2002, the company's KE Division reported sales of $66.4
million, 1% less than the $67.3 million reported for the first
six months of 2001. Sales at the Emkay Division totaled $18.2
million for the first half, 5% more than the $17.4 million
reported in 2001. The Automotive Components Group's sales
declined by 10% to $24.6 million compared to $27.3 million in
the first six months of 2001.

While second-quarter sales increased, operating income declined
as a result of charges for the impairment of the Ruf Electronics
subsidiary's assets, which the company plans to sell, and
significant pricing pressure and unfavorable changes in product
mix at all three of the company's divisions. The company
announced that it was taking a non-cash charge of $8.7 million
for the impairment of Ruf assets held for sale, as well as an
additional $600,000 restructuring charge.

While improved operating efficiencies increased the KE
Division's operating income compared to the second quarter of
2001, the non-cash charge and declines in the operating income
at the Emkay and Automotive divisions reduced the company's
operating income and net income. Operating income for the second
quarter totaled $1.3 million, compared to $12.4 million for the
second quarter of 2001. Operating income for the first six
months totaled $9.2 million, compared to $23.3 million for the
first six months of 2001. The company's net loss for the quarter
was $7.8 million, compared to net income of $378,000 for the
second quarter of 2001. The company reported a net loss of $8.2
million for the six months compared to net income of $1.0
million for the first half of 2001.

The company's adjusted EBITDA (reported EBITDA plus
restructuring and impairment charges) for the second quarter of
2002 totaled $13.5 million, or 23.2% of sales, almost equal with
the $13.6 million, or 23.8% of sales reported for the second
quarter of 2001. For the first six months of the year, the
company's adjusted EBITDA reached $24.9 million, or 22.8% of
sales, compared to $28.3 million, or 25.3% of sales, for the
first six months of 2001. The decline in the first half EBITDA
percentage was about half due to lower gross margins caused by
customer pricing pressure and about half due to selling, general
and administrative costs being a higher percentage of sales.

In the Company's June 30, 2002 balance sheet, its total
shareholders' equity deficit reaches $485 million.

"At a time when world markets were flat or down, we increased
our sales in the second quarter," commented President and CEO
John Zei. "What's more, we continued to improve our cash flows.
The full implementation of our Enterprise Resource Planning
system, significant inventory reductions, and improved supply
chain management has helped us control costs and respond to the
challenging conditions we face today."

The company has moved aggressively to control its costs and
increase its ability to generate cash. Capital expenditures for
the first half were down more than $7 million compared to 2001.
Vice President and CFO Jim Moyle noted that the slight increase
in the company's selling, general and administrative expenses
resulted from the expenses and charges associated with
renegotiating its bank lending agreements in May. "Cash
generated by operations continues to rise," he said. "We are
imposing very tight control over working capital."

While the company does not expect any short-term improvements in
its markets, it said that its launch of new products is
proceeding on schedule and that it expects to deliver its first
shipments of new silicon microphones by the end of the year.
Meanwhile, shifting the remainder of its production operations
to its Asian facilities will help the company continue to
improve its productivity. "We've made good progress in
streamlining and improving our operations," said Zei. "Our
bottom line performance is our number one priority."

Knowles Electronics is the world's leading manufacturer of
transducers and related components used in hearing aids. The
company also manufactures acoustic components used in voice
recognition, telephony, and Internet applications as well as
automotive solenoids and sensors. In 1999, the European fund
management company Doughty Hanson & Co Ltd acquired Knowles.


LTV CORP: Nonprofit Group Acquires former Hazelwood Works Asset
---------------------------------------------------------------
A nonprofit partnership of Pittsburgh foundations and a regional
development authority has signed an agreement with LTV Corp., to
purchase the firm's 178-acre former Hazelwood Works along Second
Avenue near the Pittsburgh Technology Center.

The group, acting as a limited partnership under the name
ALMONO, LP, must wait for final approval from the U.S.
Bankruptcy Court in Youngstown.  LTV filed for bankruptcy
protection in December of 2000, shortly after the group began
negotiating with the steel company for the purchase of the land.

A second key milestone in the acquisition and development
process occurred recently with the Pennsylvania Department of
Environmental Protection approval of clean-up efforts at the
site to allow for commercial use.  The approval is conditional
on continuing monitoring of ground water.

"After more than two years of discussions, we are delighted to
move forward to consider the future of this strategic riverfront
site," said Frank Brooks Robinson, Sr., president of the
Regional Industrial Development Corporation of Southwestern
Pennsylvania, an ALMONO general partner.

Joining with RIDC as limited partners are four Pittsburgh-based
foundations, Claude Worthington Benedum Foundation, The Heinz
Endowments, Richard King Mellon Foundation and the McCune
Foundation.

"The foundations have joined together in this unusual effort to
set a national standard for brownfield development," said
Maxwell King, executive director of The Heinz Endowments.  "We
agree with the assessment of the mayor, Urban Redevelopment
Authority officials and others experienced in development that
this land parcel offers tremendous opportunities as a truly
mixed-use site, where we can expand commercial uses to include
high-quality office space, light manufacturing and river
transport operations," said King.  "But we foundations are
particularly interested in taking full advantage of the
riverfront land in this project by creating more parkland and
recreational trails."

King said the foundations also are confident that returns on
their investments in the partnership will allow for similar
development grantmaking in future projects.

Robinson expressed regret that "the bankruptcy process had
slowed efforts to win approval of the deal and allow the project
to go forward.  But we did not let the delays in the signing of
the agreement stand in the way of planning.  We've been able to
complete important preliminary work in more than a year of
meetings in order to be able to address concerns of the mayor
and others that there be sites available and ready for occupancy
to show potential employers."

Both Robinson and King emphasized that their partnership will
continue with a comprehensive community process involving city
officials, redevelopment experts and university officials among
others, who will finalize the requirements for a master plan and
choose a consultant to create it.

Participants in the year-long planning effort, including
development of a master plan outline and criteria for choosing a
consultant, represent a broad range of stakeholder leaders,
including Murphy administration officials - Susan Golomb,
director of city planning, and Tom Bayuzik, director of the
mayor's office of economic development; local architects Donald
K. Carter and Paul B. Ostergaard of Urban Design Associates;
urban planner Alex Krieger of Chan Krieger & Associates; Don
Smith of Carnegie Mellon University and The University of
Pittsburgh's joint economic development initiative; Lisa Kunst
Vavro of the Hazelwood Initiative; and Robert Stephenson of the
Strategic Investment Fund.

Full development at the site is still subject to approvals from
several city and state agencies.

RIDC is recognized as one of Pennsylvania's largest and most
successful not-for-profit economic development agencies.  RIDC
has been active in the development of urban and suburban
business parks in the ten counties of southwestern Pennsylvania.  
In addition, RIDC acts as loan sponsor on behalf of business
enterprises throughout the region with a variety of city,
county, state, and federal agencies.


LERNOUT & HAUSPIE: ScanSoft Proposes $6.8MM Buyback of Shares
-------------------------------------------------------------
ScanSoft, Inc. (Nasdaq: SSFT), a leading supplier of digital
imaging, speech and language solutions, has proposed to
representatives of Lernout & Hauspie Holdings and Lernout &
Hauspie, N.V., the terms of a transaction that are intended to
provide for the orderly disposition of approximately 7.4 million
shares of ScanSoft's common stock, which were issued as part of
the Company's December 2001 purchase of the speech and language
business of L&H. The proposed terms include ScanSoft's offer to:

     --  Repurchase shares of its common stock worth $6.8
million from L&H at the closing price yesterday, August 5, 2002,
of $4.79,

     --  Issue approximately 300,000 shares to holders of the
remaining six million shares as consideration for holding
ScanSoft shares for a period of one year, and

     --  Effect the orderly disposition of the remaining shares
after one year, through a public offering.

"Because we believe ScanSoft's shares are significantly
undervalued, the combination of an immediate share buyback and
12-month holding period serves to maximize value to both our
shareholders and the L&H creditors," said Paul Ricci, chairman
and CEO of ScanSoft. "As the L&H assets continue to perform
beyond our expectations, this proposal is designed to give the
creditors additional opportunity to participate in the Company's
growth."

ScanSoft made this proposal to L&H representatives Tuesday and
has asked for a response by the close of business on Friday,
August 9, 2002.

On December 12, 2001, ScanSoft announced that it had closed the
acquisition of substantially all the operating and technology
assets of L&H's Speech and Language Technologies business.
Consideration for the transaction comprised $10 million in cash,
a $3.5 million note and 7.4 million shares of ScanSoft stock.
The U.S. Bankruptcy Court for the District of Delaware approved
the transaction on December 11, 2001.

ScanSoft, Inc. (Nasdaq: SSFT), is the leading supplier of
imaging, speech and language solutions that are used to automate
a wide range of manual processes - saving time, increasing
worker productivity and improving customer service. For more
information regarding ScanSoft products and technologies, please
visit http://www.scansoft.com


LUCENT: S&P Places B+ Corp. Credit Rating on Watch Negative
-----------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit rating and other ratings on Lucent Technologies Inc., and
revised its outlook on the company to negative from stable.

Lucent, a leading supplier of communications equipment for
service providers, is based in Murray Hill, New Jersey. Lucent
Technologies faces challenging market conditions, as the
company's core customer base continues to defer purchases of new
communications equipment. The outlook reflects continued
stresses in market conditions and increasing uncertainty as to
the company's ability to return to profitability. Lucent had
$5.3 billion of combined debt and preferred stock outstanding at
June 30, 2002.

Industry conditions are not expected to improve materially over
the next year, as carriers continue to defer capital
expenditures in light of renewed economic concerns and lack of
marketplace visibility. Lucent's ability to meet prior revenue
targets in light of challenging market conditions had become
increasingly problematic by the June quarter, and the company is
not providing guidance for the September 2002 quarter.

"If the company cannot achieve its targeted return to net
profitability by the end of fiscal 2003, or if other financial
measures erode materially, ratings could be lowered," said
Standard & Poor's credit analyst Bruce Hyman.

Lucent Technologies' 7.7% bonds due 2010 (LU10USR1) are trading
at 67 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=LU10USR1 for  
real-time bond pricing.


METALS USA: Enters Pacts to Sell Assets of 3 Operations for $50M
----------------------------------------------------------------
Metals USA, Inc. (OTC Bulletin Board: MUINQ), a Houston-based
metals processor and distributor, has entered into three asset
purchase agreements for the sale of substantially all of the
assets of three of its operations.  Proceeds from the
disposition of these operations will total approximately $50
million.

Two of these asset purchase agreements have been entered into
with Reliance Steel and Aluminum Co. (NYSE: RS), headquartered
in Los Angeles, California.  The first asset purchase agreement
provides for the purchase by Reliance of substantially all of
the assets of Metals USA Specialty Metals Northwest, Inc.
headquartered in Portland, Oregon, formerly known as Pacific
Metals Company, with additional locations in Eugene, Oregon;
Kent (Seattle) and Spokane, Washington; Billings, Montana; and
Boise, Idaho. Proceeds from the disposition of the Metals USA
Specialty Metals Northwest operations will total approximately
$30 million, not including approximately $6 million of
receivables.  The second asset purchase agreement provides for
the purchase by Reliance of substantially all of the assets of
Metals USA Plates and Shapes Northcentral, Inc., located in
Milwaukee, Wisconsin, formerly known as Williams Steel.  
Proceeds from the disposition of the Metals USA Plates and
Shapes Northcentral, Inc., operation will total approximately $7
million, not including approximately $4 million of receivables.

In a separate transaction, Argon Industries, Inc., headquartered
in Milwaukee, has entered into an asset purchase agreement for
the purchase of substantially all of the assets of Metals USA
Contract Manufacturing, Inc., located in Milwaukee. Proceeds
from the disposition of the Metals USA Contract Manufacturing,
Inc. operation will total approximately $1.5 million, not
including approximately $0.5 million of receivables.

J. Michael Kirksey, Metals USA's chairman, president and chief
executive officer, stated, "The proceeds from these sales will
allow us to further reduce our bank debt aiding our progress
towards exiting Chapter 11 Court protection as scheduled."

The company added that the these asset purchase agreements are
subject to a thirty day Bankruptcy Court required auction
process that will conclude by early September 2002.  During this
period, superior bids can be made for each of these operations.  
Each asset purchase agreement is contingent, and shall become
effective, upon the final approval of the Bankruptcy Court.

Metals USA, Inc., is a leading metals processor and distributor
in North America.  With a customer base of more than 45,000,
Metals USA provides a wide range of products and services in the
Carbon Plates and Shapes, Flat-Rolled Products, and Building
Products markets.  For more information, visit the Company's Web
site at http://www.metalsusa.com


NDC AUTOMATION: Must Seek New Financing to Meet Liquidity Needs
---------------------------------------------------------------
NDC Automation Inc.'s net revenues decreased by $502,614, or
29.6%, from $1,700,665 in the earlier period to $1,198,051 in
the latter period. The decrease is primarily due to the
decreased project AGV system sales compared to the prior year.

Cost of goods sold decreased from $909,655 to $723,174, or
20.5%, due primarily to decreased revenues in the current year
compared to the prior year. As a percentage of net revenues,
cost of goods sold increased to 60.4% compared to 53.5% in 2001
due primarily to lower margins on technology components. Gross
profit decreased by $316,133, or 40.0%, from $791,010 to
$474,877, while gross profit as a percentage of net revenues
decreased to 39.6% from 46.5% due to the same factor.

The Company closed on the sale of its land and building in March
2001 for $1,600,000 and realized a gain of $581,023 after
deducting moving expenses of approximately $30,000. In the new
location, the Company combined all its operations for testing,
development, manufacturing and distribution to improve its
operating efficiencies. The Company had no such sale in 2002.

Selling expenses decreased from $161,077 to $159,926, or .7%.
General and administrative expenses decreased from $337,343 to
$296,169, or 12.2%, compared to the prior year due to across the
board reductions. As a percentage of net revenues, general and
administrative expenses increased from 19.8% to 24.7%.

Primarily as a result of the foregoing, operating income
decreased by $837,560 from an operating income of $848,985 in
the earlier period to an operating income of $11,425 in the
latter period.

Net interest expense decreased from $9,966 to $3,138, a decrease
of $6,828. Lower borrowing in the current year compared to the
prior year resulted in the significant decline.

The Company did not recognize any tax benefits in 2002 and 2001
for its current income as all prior taxes were recognized in the
previous financial statements. Utilization of operating loss
carryforwards in the future are not assured to be realized.

Primarily due to lower net revenues and lower gross profit on
revenues and the sale of the land and building as described
above, the Company earned a net income of $8,287 in the three
months ended 2002 compared to a net income of $839,019 in same
period of 2001.

Backlog consists of all amounts contracted to be paid by
customers but not yet recognized as net revenues by the Company.
At May 31, 2002, the Company had a backlog of approximately
$1,590,000 compared to approximately $1,670,000 one year
earlier. Quoting activity for the Company remains good, but
there can be no assurances that such activity will result in
firm business for the Company.

                Six Months Ended May 31, 2002

Net revenues decreased by $726,843, or 25.3%, from $2,870,057 in
the earlier period to $2,143,214 in the latter period. The
decrease is primarily due to the decreased project AGV system
sales compared to the prior year.

Cost of goods sold decreased from $1,688,512 to $1,484,191, or
12.1%, due primarily to higher cost on purchases and lower
revenues in the current year compared to the prior year. As a
percentage of net revenues, cost of goods sold increased from
58.8% to 69.3%. Gross profit decreased by $522,522, or 44.2%,
from $1,181,545 to $659,023, while gross profit as a percentage
of net revenues decreased from 41.2% to 30.7%.

Selling expenses decreased from $350,027 to $303,950 in 2002
primarily due to lower personnel cost. General and
administrative expenses increased from $582,696 to $596,438, or
2.4%, compared to the prior year. The Company continued to
invest in the development of new AGV products to expand its
product line in the current year. Investments were significantly
less in the current year compared to the prior year due to
present cash flow constraints.

Primarily as a result of the foregoing, the operating loss for
the period was $265,819 compared to an operating income of
$756,233 the prior year.

Net interest expense decreased from $52,882 to $7,635, a
decrease of 85.6 %. The repayment of the mortgage loan and line
of credit in March 2001 significantly lowered the borrowings
compared to the prior year resulting in the decline in interest
expense.

The Company did not recognize any tax benefits (expense) in 2002
and 2001 for its current loss (income) as all prior taxes were
recognized in the previous financial statements.

Primarily due to the sale of the land and building, lower
revenues and gross profit as described above, the Company's net
income decreased by $976,805 from a net income of $703,351 in
the six month ended 2001 to a net loss of $273,454 in the same
period of 2002.

                    Liquidity and Capital Resources

The Company experiences needs for external sources of financing
to support its working capital, capital expenditures and
acquisition requirements when such requirements exceed the cash
generated from operations in any particular fiscal period. The
amount and timing of external financing requirements depend
significantly upon the nature, size, number and timing of
projects and contractual billing arrangements with customers
relating to project milestones. Historically, the Company has
relied upon bank financing under a revolving working capital
facility as well as long-term debt and capital leases and
proceeds of its public and private offerings to satisfy its
external financing needs. Currently the Company relies on its
operating cash flows for its operations.

During the six months ended May 31, 2002 net cash used by
operating activities was $163,689. At May 31, 2002 the Company
had a working capital deficit of $135,406. Due to cash flow
shortages, the Company had delayed payments to vendors of
approximately $290,000.

The Company has been operating under adverse liquidity
conditions due to a deficit and negative working capital. The
current accounts payable balance to Netzler & Dahlgren at May
31, 2002 was approximately $225,000. The Company receivables
were pledged to Netzler & Dahlgren to secure its note receivable
from the Company, such note having a principal balance of
$73,235 at May 31, 2002 in exchange for the security interest
previously held by Netzler & Dahlgren in the office property.
Such pledge is to remain in place until the N & D note is paid
in full.

Netzler & Dahlgren has indicated to the Company that Netzler &
Dahlgren's financial exposure to the Company must be reduced by
timely payment of the N & D note. To ensure prompt payments, the
Company must remain profitable or raise additional equity and/or
debt to refinance the N & D note. In the first quarter of 2002,
the Company began paying vendors on a deferred basis to meet its
obligation to Netzler & Dahlgren on the note payable and retain
its license agreement. During the second quarter the Company
continued to pay vendors on a deferred basis and could not meet
its obligations on the note payable to Netzler & Dahlgren.
Should Netzler and Dahlgren demand for payment of the note the
Company stands to lose its license agreement. On July 1, 2002
Netzler & Dahlgren agreed on extending the maturity date of the
N & D note to November 30, 2002 with interest accruing at 9%. If
the Company is unable to satisfy these obligations with Netzler
& Dahlgren, it risks termination of its license agreement with
Netzler & Dahlgren.

There are no assurances that the deficiency in the cash flow
will not continue. The Company continues exploring the
possibility of raising additional equity capital or subordinated
debt, either directly or possibly through a business
combination, in order to improve its financial position and have
the working capital to address potential growth opportunities.
There can be no assurances that the Company will be successful
in maintaining its profitability or raising the additional
capital or subordinated debt that may be necessary for the
Company's operations. The Company's ability to continue as a
going concern would be adversely affected if the Company were
not able to improve its working capital and liquidity.


NATIONSRENT INC: Expects to Name New Permanent CEO Soon
-------------------------------------------------------
As of July 31, 2002, NationsRent's Executive Vice President and
Chief Financial Officer Ezra Shashoua advises that the Company
is still conducting its search for a permanent CEO search.
NationsRent hopes to name the new CEO soon.

While the Company's failure to hire a CEO constitutes a
technical default under the DIP Financing Facility, as amended
through June 28, 2002, Mr. Shashoua points-out that the Company
is working closely with the DIP Lenders, anticipates the Lenders
agreeing to waive this covenant, and has not drawn on the DIP
Facility. (NationsRent Bankruptcy News, Issue No. 16; Bankruptcy
Creditors' Service, Inc., 609/392-0900)

NationsRent Inc.'s 10.375% bonds due 2008 (NRNT08USR1) are
trading at 1 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=NRNT08USR1
for real-time bond pricing.


NEON COMMS: U.S. Trustee Appoints Unsecured Creditors' Committee
----------------------------------------------------------------
The United States Trustee for Region 3 appointed a seven-member
Official Unsecured Creditors' Committee in the chapter 11 cases
involving Neon Communications, Inc., and Neon Optica, Inc.  The
Committee members, each one of the Debtors' largest unsecured
creditors, are:

     1. U.S. Bank National Association
        Attn: Diana Jacobs
        1420 Fifth Avenue, 7th Floor
        Seattle, WA 98101
        Tel: 206-344-4680, Fax: 206-344-4632;

     2. Mackay Shields, LLC
        Attn: Don E. Morgan
        9 West 57th Street
        33rd Floor, New York, NY 10019,
        Tel: 212-230-3911, Fax: 212-754-9187;

     3. Lampe, Conway & Co., LLC
        Attn: Steven G. Lampe
        730 Fifth Avenue, Suite 1002
        New York, NY 10019
        Tel: 212-581-8989, Fax: 212-581-8999;

     4. Singer Children's Management Trust & Affiliates
        Attn: Gary Singer, Investment Advisor
        113 Jackson Drive, Cresskill NJ 07626
        Tel: 201-568-7887, Fax: 201-568-6624;

     5. Lutheran Brotherhood High Yield Fund
        Attn: Mark L. Simenstad
        625 Fourth Avenue South, MS 1010
        Minneapolis, MN 55415        
        Tel: 612-340-4194, Fax: 612-340-0408;

     6. Metromedia Fiber Network
        Attn: Hadley Feldman
        One Meadowlands Plaza
        East Rutherford, NJ 07073        
        Tel: 973-202-0087, Fax: 201-531-2803; and

     7. NSTAR Communications, Inc.
        Attn: David H. Lake
        800 Boylston Street
        Boston, MA 02199,        
        Tel: 617-424-2083, Fax: 617-424-2110.

NEON Communications, Inc., owns certain rights to fiber and all
of the outstanding stock of NEON Optica, Inc., which owns and
operates a fiber optic network services. The Company filed for
chapter 11 protection on June 25, 2002. David B. Stratton, Esq.,
at Pepper Hamilton LLP and Madlyn Gleich Primoff, Esq., at
Richard Bernard, Esq., represent the Debtors in their
restructuring efforts. When the Debtors filed for protection
from its creditors, it listed $55,398,648 in assets $19,664,234
in debts.


NETIA HOLDINGS: Equity Deficit Reaches $207 Million at June 30
--------------------------------------------------------------
Netia Holdings (NASDAQ: NTIAQ/NTIDQ; WSE: NET), Poland's largest
alternative provider of fixed-line telecommunications services,
announced unaudited financial results for the second quarter and
half year ended June 30, 2002.

Financial Highlights:

     - Revenues for H1 2002 were PLN 298.0m (US$73.7m), a year-
on-year increase of 16%. Revenues for Q2 2002 were PLN 151.4m
(US$37.5m), a year-on-year increase of 13%.

     - EBITDA margin for H1 2002 reached 24.3%. EBITDA margin
for Q2 2002 was 27.9%.

     - EBITDA for H1 2002 was PLN 72.3m (US$17.9m), a year-on-
year increase of 132%. EBITDA for Q2 2002 was PLN 42.2m
(US$10.5m), a year-on-year increase of 165%.

     - Cash at June 30, 2002 was PLN 364.9m (US$90.3m),
excluding restricted investments of PLN 55.3m (US$13.7m).

     - Consolidated shareholders' equity at the end of H1 2002
was negative PLN 838.7m or US$207.5m.

     - The Restructuring Agreement relating to Netia's debt
restructuring was signed by Netia, Telia AB, Warburg Pincus,
certain financial creditors and the Ad Hoc Committee of
Noteholders on March 5, 2002. The terms of the restructuring
include the exchange of Netia's existing Notes and swap of
claims for new notes with an aggregate principal amount of
EUR50m and ordinary shares representing 91% of Netia's share
capital immediately post-restructuring. The existing Netia
shareholders would retain 9% ownership and receive warrants to
acquire shares representing 15% of Netia's post-restructuring
share capital. Additionally, up to 5% of the post-restructuring
share capital, excluding the warrants to be issued to the
existing shareholders, would be issued under a key employee
stock option plan.

     - All necessary share and warrant issuances with regard to
Netia's restructuring have been approved by its shareholders. In
April 2002, Netia filed with the Polish Securities and Exchange
Commission a prospectus relating to the issuance and
registration of shares in relation to the Restructuring
Agreement which is currently being reviewed by the Polish SEC.

     - Arrangement proceedings in Poland were opened with
respect to Netia Holdings S.A. and two of its subsidiaries,
Netia Telekom S.A. and Netia South Sp. z o.o. The majority of
creditors of Netia Holdings and Netia Telekom, representing over
95% and 98% of total value of claims, respectively, voted in
favor of the arrangement plans. The Polish court approved the
arrangement plan for Netia Telekom on June 25, 2002. A minority
group of Netia Holdings' claimholders filed a complaint against
the court approval in the Netia Telekom arrangement proceedings.
The hearing regarding the approval of the arrangement plan for
Netia Holdings was scheduled for August 8, 2002, when the court
indicated that it would make a final decision. Netia expects
that the same group of minority claimholders may appeal the
decision if the court accepts the arrangement. The date for
voting of creditors of Netia South was set for August 13, 2002.

     - Composition proceedings in the Netherlands were opened on
July 12, 2002 for three Netia subsidiaries, Netia Holdings B.V.,
Netia Holdings II B.V. and Netia Holdings III B.V., in order to
restructure the obligations owed under the high yield notes
issued by Netia Holdings B.V. and Netia Holdings II B.V. and
under a cross-currency swap agreement executed by Netia Holdings
III B.V. The court in Amsterdam granted a provisional payment
suspension on repayment of obligations of these companies.

     - Further deferral on license fee payments amounting to
approximately EUR 33m, originally due in November and December
2001, was received until December 31, 2002.

     - Changes in capital base of Netia 1, a provider of
domestic long-distance services. Stoen S.A. will acquire 133,233
existing shares of Netia Holdings S.A. in exchange for 87,332
shares in Netia 1. As a result of the transaction, the Netia
group companies will jointly own an 89% stake in Netia 1 while
Telia AB will hold an 11% stake.

     - Telia ducts leasing agreement. In January 2002 Netia and
Telia AB signed a ducts lease agreement, under which Netia was
to lease to Telia two ducts on the route between Warsaw and the
Szczecin area for the amount of approximately US$16m. In the
notice from Telia received on May 16, 2002, Telia informed that
in its opinion this agreement expired due to the non-fulfillment
by April 15, 2002 of all of the conditions specified in the
agreement. Telia also indicated its interest in continuing
discussions with Netia regarding the utilization of Netia's
backbone network. Netia believes that the conditions to which
Telia referred were reserved on Netia's behalf, and therefore
the existing agreement remains valid and does not require the
execution of an additional agreement. Netia intends to undertake
the necessary steps with an aim to fulfill the agreement.

Operational Highlights:

     - Netia's nationwide backbone network increased to 3,320 km
as of June 30, 2002.

     - Subscriber lines increased to 342,145 net of churn and
disconnections, a year-on-year increase of 1%.

     - Business customer lines increased to 101,997, a year-on-
year increase of 16%. The business segment reached 29.8% of
total subscriber lines while year-to-date revenues from business
customers accounted for 57.0% of telecom revenues as of June 30,
2002.

     - Average revenue per line increased by 2% to PLN 123 in
June 2002, compared to PLN 121 in June 2001.

     - New supplementary tariff packages for indirect domestic
long-distance (customers of Netia 1) and ISDN services, with
usage time measured on a per-second basis, were introduced on
June 1, 2002.

     - Headcount decreased to 1,323 at June 30, 2002 from 1,639
at June 30, 2001 as a result of management's program of cost
reduction initiated in August 2001.

Other Highlights:

     - Ordinary Shareholders' Meeting of Netia Holdings S.A.
held on June 18, 2002 (i) approved the Management Board's report
and financial statements for the 2001 financial year, (ii)
appointed PricewaterhouseCoopers Sp. z o.o. as its auditor to
examine the financial statements for the 2002 financial year,
(iii) approved the remuneration granted in 2001 and 2002 to date
to members of the Supervisory Board and (iv) re-adopted certain
shareholders' resolutions from the March 12, 2002 Extraordinary
General Shareholders' Meeting.

     - Changes within Netia's Supervisory Board. Effective June
17, 2002, Hans Tuvehjelm replaced Lars Rydin as a Supervisory
Board member on behalf of Telia AB.

     - Changes within Netia's Management Board. Effective June
1, 2002, Stefan Albertsson was appointed to Netia's Management
Board with responsibility for Marketing and Products.

     - Netia's ADS-to-Ordinary Shares ratio changed to one-to-
four as of beginning of trading on Nasdaq on July 30, 2002.
Previously, Netia's ADS-to-Ordinary Shares ratio was one-to-one.
The change in the ADS-to-Ordinary Shares ratio has been effected
without charge to investors. For the next 20 trading days, the
ticker symbol for Netia Holdings S.A. will be "NTIDQ." After
expiration of these 20 trading days, the symbol will revert to
NTIAQ.

                         Financial Information
               2002 Year to Date vs. 2001 Year to Date

Revenues increased by 16% to PLN 298.0m (US$73.7m) for H1 2002
compared to PLN 257.2m for H1 2001.

Revenues from telecommunications services increased by 19% to
PLN 287.6m (US$71.2m) in H1 2002 from PLN 241.9m in H1 2001. The
increase was primarily attributable to an increase in total
number of subscriber lines coupled with an increase in average
revenue per line associated with the increase in business mix of
lines as well as introduction of new products. The total number
of subscriber lines increased by 1% to 342,145 at June 30, 2002
from 338,338 at June 30, 2001, while the overall increase in
average monthly revenue per line was 2% to PLN 123 (US$30) for
June 2002, compared to PLN 121 for June 2001.

EBITDA increased by 132% to PLN 72.3m (US$17.9m) in H1 2002
compared with PLN 31.1m for H1 2001. EBITDA margin for H1 2002
increased to 24.3% from 12.1% for H1 2001. This was achieved  
thanks to a successful implementation of a cost reduction
program in late 2001, being part of the cash preservation
measures.

"Other operating expenses" amounted to PLN 161.9m (US$40.1m) and
represented 54% of total revenues in H1 2002, compared to 63% in
H1 2001, with salaries and benefits being the main item.

Interconnection charges increased by 3% to PLN 59.6m (US$14.7m)
in H1 2002 from PLN 58.1m in H1 2001. Interconnection charges as
a percentage of calling charges decreased to 29% from 34%,
reflecting the increased proportion of traffic carried through
Netia's own backbone network.

Depreciation of fixed assets increased by 20% to PLN 97.3m
(US$24.1m) in H1 2002, from PLN 81.9m in H1 2001, as the
construction stage of additional parts of the network was
completed.

Amortization of goodwill and other intangible assets decreased
to PLN 36.6m (US$9.1m) in H1 2002 from PLN 36.9m in H1 2001. Net
financial expenses increased to PLN 432.3m (US$107.0m) in H1
2002 from PLN 12.4m in H1 2001 due to foreign exchange losses
resulting from the depreciation of the Polish zloty against the
euro and U.S. dollar in H1 2002 compared to the zloty's
appreciation in H1 2001. Additionally, the interest costs
connected with the notes issued by Netia accrued through the
whole six month period ended June 30, 2002 although the Company
ceased to pay interest on its notes in December 2001.

Net loss amounted to PLN 495.4m (US$122.6m) in H1 2002, compared
to a net loss of PLN 101.8m in H1 2001. The higher loss was
attributable to an increase in net financial expenses related
mainly to unrealized foreign exchange losses. However, a
majority of the financial expenses is not reflected in cash
outflows, due to the facts described above.

Cash used in investing activities decreased by 63% to PLN 164.8m
(US$40.8m) in H1 2002, from PLN 444.2m in H1 2001, in accordance
with the revised business plan approved in late 2001.

Cash and cash equivalents at June 30, 2002 amounting to PLN
364.9m (US$90.3m) were available to fund Netia's operations. The
Company also had deposits in an investment account of PLN 55.3m
(US$13.7m) at June 30, 2002 established, subject to conditions,
to service the interest payments on its 2000 Senior Notes in
June 2002. These deposits are expected to be transferred to the
Company in accordance with the Restructuring Agreement at the
completion of the restructuring.

                      Q2 2002 vs. Q1 2002

Revenues increased by 3% to PLN 151.4m (US$37.5m) for Q2 2002
compared to PLN 146.6m for Q1 2002. This increase was
attributable to a 4% increase in telecommunications revenues to
PLN 146.9m (US$36.3m) in Q2 2002 from PLN 140.8m in Q1 2002 and
a 22% decrease in other revenues, representing the operations of
Uni-Net, a joint venture with Motorola offering radio trunking
services, to PLN 4.5m (US$1.1m) for Q2 2002 from PLN 5.8m in Q1
2002.

EBITDA increased by 40% to PLN 42.2m (US$10.5m) in Q2 2002
compared with PLN 30.1m for Q1 2002. EBITDA margin for Q2 2002
increased to 27.9% from 20.5% for Q1 2002. The increase in
EBITDA and EBITDA margin was mainly a result of a strict cost
control policy implemented in late 2001.

Net loss amounted to PLN 250.0m (US$61.9m) in Q2 2002, compared
to a net loss of PLN 245.4m in Q1 2002. The higher loss was
attributable to an increase in net financial expenses and
unrealized foreign exchange losses.

                        Operational Review

Connected lines at June 30, 2002 increased by 0.4% to 529,658
lines, up from 527,562 lines at March 31, 2002. The number of
connected lines decreased in comparison with the number reported
for Q2 2001 due to the write-off of 70,200 lines recorded in the
third quarter of 2001.

Subscriber lines in service increased by 1% to 342,145 at June
30, 2002 from 338,338 at June 30, 2001 and decreased by 0.04%
from 342,288 at March 31, 2002. The number of subscriber lines
is net of customer churn and disconnections of defaulting payers
by the Company, which amounted to 4,197 and 5,910, respectively,
for Q2 2002 and 11,342 and 13,209, respectively, for H1 2002.
The recorded churn was mostly a result of customers affected by
the deterioration of Polish economic conditions and customers
moving outside the coverage of Netia's network.

Business lines as a percentage of total subscriber lines reached
29.8%, up from 26.0% at June 30, 2001 and 29.4% at March 31,
2002, reflecting the intensified focus on the corporate and SME
market segments. Business customers accounted for all net
additions in the quarter while the residential segment saw net
disconnections. Revenues from business customers accounted for
57.0% of telecommunications revenues in H1 2002.

Business customer lines in service increased by 16% to 101,997
at June 30, 2002 from 87,992 at June 30, 2001 and by 1% from
100,563 at March 31, 2002.

Average monthly revenue per line grew by 2% to PLN 123 (US$30)
in June 2002, compared to PLN 121 in June 2001 and decreased by
5% from PLN 130 in March 2002.

Average monthly revenue per business line amounted to PLN 236
(US$58) in June 2002, representing a 1% decrease from PLN 239 in
June 2001 and a 6% decrease from PLN 251 in March 2002.

Average monthly revenue per residential line amounted to PLN 74
(US$18) in June 2002, representing a 8% decrease from PLN 80 in
June 2001 and a 6% decrease from PLN 79 in March 2002.

An integrated customer relationship management (CRM) system was
launched in April 2002, the first integrated CRM system of any
Polish telecom operator.

Internet flat rate service was launched for Netia directly and
non-directly connected users of Internet dial-up access as well
as for Netia customers using ISDN Duo lines on April 16, 2002,
June 17, 2002, and July 5, 2002, respectively. The new service
allows connecting to Internet for a specified number of hours
each month for a predetermined flat rate, the usage time is
measured on a per-minute basis.

New tariff packages for indirect domestic long-distance
(customers of Netia 1) and ISDN services were introduced on June
1, 2002. These new packages supplement the current Netia tariff
offerings, providing easy-to-understand tariff plans with the
usage time measured on a per-second basis.

Netia 1055 Internet telephony service, which offers cheaper
international calls based on the Voice-over-IP technology, was
launched on July 1, 2002. The new service complements the
existing service offerings of Netia 1, a provider of indirect
domestic long-distance service through Netia's prefix (1055).

Connections to mobile networks at competitive pricing levels
were offered to customers of Netia 1 as of August 1, 2002. This
is another complementary service offered by to users of Netia's
indirect domestic long-distance services.

Netia's nationwide backbone network connecting Poland's largest
urban areas now stretches to 3,320 kilometers and consists of
2,430 kilometers of fiber and 890 kilometers of leased lines.
Netia is constructing additional infrastructure, planned for
completion in 2002, of approximately 960 kilometers to replace
most of the present leased lines.

Headcount at June 30, 2002 was 1,323, compared to 1,639 at June
30, 2001 and 1,362 at March 31, 2002. During 2001 Netia made
announcements on headcount reductions of approximately 20%, and
finalization of this program is being carried out.

The number of active lines in service per employee increased by
25% to an average of 265 in Q2 2002, from 212 in Q2 2001. The
number of active lines in service per employee in H1 2002
increased by 22% to an average of 256 from 209 in H1 2001.

Monthly average telecommunications revenue per employee
increased by 45% to PLN 38,262 in Q2 2002 from PLN 26,321 in Q1
2001. Monthly average telecommunications revenue per employee in
H1 2002 increased by 43% to PLN 36,246 from PLN 25,352 in H1
2001.

License payments. The Polish Minister of Infrastructure decided
on June 28, 2002 to postpone the payment of license fee
installments of certain Netia operating subsidiaries, originally
due in November and December 2001, until December 31, 2002.
Previously, on November 30, 2001 and January 19, 2002, the
Minister of Infrastructure announced his decision to postpone
the payment of these installments until January 20, 2002 and
June 30, 2002, respectively. The current total amount of these
installments is approximately EUR 33 million. In his latest
decision of June 28, 2002, the Minister of Infrastructure did
not impose any postponement fees which are to be determined
later. Netia submitted claims to the Polish regulatory
authorities seeking to confirm expiry, cancellation or deferral
of its remaining license fee obligations, following the
regulatory environment changes introduced with the enactment of
the new Telecommunications Act on January 1, 2001.

Changes in capital base of Netia 1, a provider of indirect
domestic long-distance services. Netia Holdings S.A. and the
Warsaw electric utility Stoen S.A. agreed on July 2, 2002 that
Stoen S.A. will acquire 133,233 existing shares of Netia
Holdings S.A. in exchange for Stoen's 87,332 shares in Netia 1.
The agreement is pursuant to the Netia 1 consortium agreement
and changes in the new Polish telecom law effective as of
January 1, 2001, abolishing the foreign ownership restrictions
on telecom operators in Poland. As a result of the transaction,
the Netia group companies will jointly own an 89% stake in Netia
1. The remaining 11% stake will be owned by Telia AB.


NETIA HOLDINGS: Sets Extraordinary General Meeting for August 30
----------------------------------------------------------------
Netia Holdings S.A. (Nasdaq: NTIAQ/NTIDQ, WSE: NET), Poland's
largest alternative provider of fixed-line telecommunications
services, will hold an Extraordinary General Meetings of
Shareholders in Warsaw on August 30, 2002 to adopt resolutions
on extending the term of certain members of its Supervisory
Board.

Netia Holdings SA's 13.50% bonds due 2009 (NETH09PON2),
DebtTraders reports, are trading at 18 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=NETH09PON2
for real-time bond pricing.


NEWPOWER COMPANY: Bringing-In Sidley Austin as Attorneys
--------------------------------------------------------
The New Power Company and its debtor-affiliates seek authority
from the U.S. Bankruptcy Court for the Northern District of
Georgia to employ Sidley Austin Brown & Wood LLP as their
attorneys.  The Debtors specifically ask the Court to retain
Sidley Austin as their bankruptcy attorneys to commence their
chapter 11 cases and for prosecution of their chapter 11 cases.

The Debtors relate that since September, 2001, Sidley Austin has
been advising the Debtors on a broad range of matters. This
engagement afforded Sidley Austin a familiarity with the
Debtors' business and legal affairs.

The Debtors assure the Court that Sidley Austin and King &
Spalding have agreed to make every effort to avoid duplication
of services in these chapter 11 cases.

Sidley Austin is expected to:

     a) advise the Debtors with respect to their powers and
        duties as debtors and debtors-in-possession in the
        continued management and operation of their business and
        properties;

     b) attend meetings and negotiating with representatives of
        creditors and other parties in interest and advising and
        consulting on the conduct of the case, including all of
        the legal and administrative requirements of operating
        in chapter 11;

     c) take all necessary action to protect and preserve the
        Debtors' estates, including the prosecution of actions
        commenced under the Bankruptcy Code on their behalf, and
        objections to claims filed against the estates;

     d) prepare on behalf of the Debtors all motions,
        applications, answers, orders, reports and papers
        necessary to the administration of the estates;

     e) negotiate and prepare on the Debtors' behalf sales or
        other disposition of assets, plan(s) of reorganization,
        disclosure statement(s) and all related agreements
        and/or documents and taking any necessary action on
        behalf of the Debtors to obtain confirmation of such
        plan(s);

     f) appear before this Court, any appellate courts, and the
        U.S. Trustee, and protecting the interests of the
        Debtors' estates before such courts and the U.S.
        Trustee; and

     g) perform all other necessary services in connection with
        these chapter 11 cases.

Sidley Austin's billing rates currently range from:

          partners                $500 to $600 per hour
          associates              $260 to $375 per hour
          para-professionals      $120 to $150 per hour

The Debtors, a provider of electricity and natural gas to
residential and small commercial customers in markets that have
been deregulated to permit retail competition, filed for chapter
11 protection on June 11, 2002. Paul K. Ferdinands, Esq., at
King & Spalding and William M. Goldman, Esq., at Sidley Austin
Brown & Wood LLP represent the Debtors in their restructuring
efforts. When the Company filed for protection form its
creditors, it listed $231,837,000 in assets and $87,936,000 in
debts.


NOVATEL WIRELESS: Falls Below Nasdaq Continued Listing Standards
----------------------------------------------------------------
Novatel Wireless, Inc. (Nasdaq: NVTL), a leading provider of
wireless data communications access solutions, announced that
Novatel Wireless' board of directors has authorized a reverse
stock split to be effected at a ratio of between one-for-ten
(1:10) and one-for-twenty (1:20), subject to approval by the
Company's stockholders at a special stockholders' meeting
scheduled for September 17, 2002. The record date for
determination of shareholders entitled to vote at the meeting is
August 7, 2002. Novatel Wireless currently has approximately
76.2 million outstanding common shares of stock.

Novatel Wireless received a Nasdaq Staff Determination letter at
the close of business on July 31, 2002, indicating that the
Company's common stock does not comply with the $1.00 minimum
bid price requirement for continued listing on The Nasdaq
National Market set forth in Nasdaq Marketplace Rule 4450(a)(5),
and that Novatel Wireless' common stock is therefore subject to
delisting from The Nasdaq National Market.

"The purpose for the reverse stock split is to reduce the number
of outstanding shares of our common stock so that the minimum
bid price increases to above $1.00," stated John Major, Chairman
and Chief Executive Officer. "By completing a reverse stock
split, the Company hopes to maintain its continued listing on
The Nasdaq National Market."

"Alternatively, the Company could also request transfer of its
common stock to The Nasdaq SmallCap Market. While we are
comfortable with the prospect of trading on Nasdaq's SmallCap
Market, we do believe the volume of our stock and our strong
business prospects justify a stock split that should help us
stay on The Nasdaq National Market," added Mr. Major.

Novatel Wireless requested a hearing before a Nasdaq Listing
Qualifications Panel to review the Staff Determination in light
of the proposed reverse stock split. A date for this hearing has
not yet been established. Novatel Wireless has been advised that
Nasdaq will not take any action to delist Novatel Wireless'
common stock from The Nasdaq National Market pending the
conclusion of that hearing.

The reverse stock split will reduce the number of common shares
issued and outstanding but, other than treatment of fractional
shares, will not affect a shareholder's proportionate equity
interest or voting rights in the Company. The conversion
features of the Company's convertible stock, including preferred
stock, options and warrants, will automatically adjust
proportionately with the reverse stock split.

Novatel Wireless, Inc., is a leading provider of wireless data
modems and software for use with handheld computing devices and
portable personal computers. The company delivers innovative and
comprehensive solutions that enable businesses and consumers to
access personal, corporate and public information through email,
enterprise networks and the Internet. Novatel Wireless also
offers wireless data modems and custom engineering services for
hardware integration projects in a wide range of vertical
applications. The Novatel Wireless product portfolio includes
the Minstrel(R) Family of Wireless Handheld Modems, Merlin(TM)
Family of Wireless PC Card Modems, Sage(R) Wireless Serial
Modems, Lancer 3W(TM) Family of Ruggedized Modems and
Expedite(TM) Family of Wireless Embedded Modems. Headquartered
in San Diego, California, Novatel Wireless is listed on the
Nasdaq Stock Market (Nasdaq: NVTL). For more information, please
visit the Novatel Wireless Web site at
http://www.novatelwireless.comor call 888-888-9231.


NUEVO ENERGY: June 30 Working Capital Deficit Reaches $17 Mill.
---------------------------------------------------------------
Nuevo Energy Company (NYSE:NEV) reported a significant increase
in net income from continuing operations of $16.3 million in the
second quarter 2002, compared to $1.8 million in the second
quarter 2001. Excluding a gain on the disposition of properties,
primarily related to the ExxonMobil litigation settlement, net
income was $7.8 million in the second quarter 2002.
Discretionary cash flow of $33.2 million in the second quarter
2002 increased from $30.8 million in the second quarter 2001.

As of June 30, 2002, the Company's balance sheet shows that its
total current liabilities exceeded its total current assets by
about $17 million.

"We achieved strong second quarter results due to a reduction in
costs and expenses, a gain derived from a dramatically changed
hedging policy and the successful monetization of certain non-
core assets," commented Jim Payne, Chairman, President and CEO.
"We also have improved our liquidity and financial position
which is another important part of our strategic plan. In this
regard, we have increased working capital by $15 million and
reduced debt by more than $30 million since the beginning of the
year. While we continue to optimize the existing asset base, we
are shifting our focus to the second phase of our strategic plan
-- the acquisition of high margin properties."

First Half 2002 vs. 2001 Highlights

     -- 27% reduction in costs and expenses (excluding the loss
        or gain on disposition of properties),

     -- $2.5 million hedging gain vs. a $40.9 million hedging
        loss,

     -- Settlement of ExxonMobil litigation by conveying Nuevo's
        interest in unproved properties in the Santa Ynez Unit
        to ExxonMobil and reporting proceeds of $16.5 million,
        and

     -- Sale of the majority of Nuevo's non-core Eastern U.S.
        oil and gas properties for $7.4 million (reported in
        discontinued operations).

                    Second Quarter Analysis

Prices and Production

Nuevo's realized crude oil price increased $3.14 per barrel to
$18.60 per barrel, despite a $1.71 per barrel decline in NYMEX
crude oil prices period-over-period, resulting in a $17.2
million improvement in hedging losses in 2002 compared to the
second quarter 2001. Oil production, which averaged 44,800
barrels per day compared to 46,500 barrels per day in the second
quarter 2001, reflects lower production in the Cymric Field,
mechanical problems at the A-21 well in the Point Pedernales
Field, and workovers in the Republic of Congo. These declines
were partially offset by higher production at the Belridge and
Midway-Sunset Fields, both of which have responded favorably to
renewed steaming. The A-21 well was placed back on production in
late July, 2002.

Nuevo's second quarter natural gas production averaged 31.3
million cubic feet per day, an 8% increase from the second
quarter 2001 due primarily to increased production onshore
California. The second quarter 2002 realized natural gas price
of $2.93 per Mcf was 76% below the realized natural gas price
for the same period in 2001.

Costs and Expenses

Cost reductions were recorded in every category with the largest
declines in exploration costs and non-steam lease operating
expenses. Excluding the gain on disposition of properties and
the steam component of lease operating expense, total costs and
expenses declined 19% to $52.9 million in the second quarter
2002 vs. $64.9 million in the second quarter 2001. Including
steam costs, lease operating costs were $35.0 million in the
second quarter 2002 compared to $48.7 million in the second
quarter 2001.

Capital Expenditures

Capital expenditures were $14.2 million in the second quarter
2002, a $38.1 million decline compared to the second quarter
2001. The majority of capital in the second quarter 2002 was
allocated to the development of onshore California oil and gas
properties.

Financial Guidance

The third quarter 2002 financial and operating guidance is
provided in a separate press release and will be posted on
Nuevo's Web site.

Nuevo Energy Company is a Houston, Texas-based company primarily
engaged in the acquisition, exploitation, development,
production, and exploration of crude oil and natural gas.
Nuevo's domestic properties are located onshore and offshore
California. Nuevo is the largest independent producer of oil and
gas in California. The Company's international properties are
located offshore the Republic of Congo in West Africa and
onshore the Republic of Tunisia in North Africa. To learn more
about Nuevo, please refer to the Company's internet site at
http://www.nuevoenergy.com  


NUEVO ENERGY: Updates Third Quarter 2002 Financial Guidance
-----------------------------------------------------------
Nuevo Energy Company (NYSE:NEV) issued financial guidance for
the third quarter 2002. Financial guidance for the year 2002
remained unchanged. The crude oil hedge position was updated to
include incremental hedges in the fourth quarter in 2002, the
first through fourth quarters in 2003, and the first quarter in
2004.

The 2002 capital budget excludes acquisitions and was based on a
price deck of $20.00 Bbl. (WTI) and $3.00 Mcf. Should commodity
prices change significantly from this level, the 2002 capital
budget could be modified. Additional factors impacting the
capital budget level include: the cost and availability of
oilfield services, exploratory drilling success, acquisitions
and divestitures and the level and availability of external
financing.

     1. Price differentials are based on differences in
location, quality, etc. and exclude the effect of hedges.

     2. For a swap transaction, we receive a fixed price for
production and pay the counter party a floating price based on a
market index. For a floor (purchased put), we receive the floor
price if the floating price falls below the floor price. Swaps
fix the price we receive for production, while floors establish
a minimum price. The previously listed hedges do not include any
contracts with Enron or its affiliates.

     3. The formula for the gas price equals $4.19 Mcf plus 25%
(WTI - $23.80 Bbl.). At a WTI oil price of $23.80 Bbl., the
corresponding gas price would be $4.19 Mcf.

     4. The steam component of lease operating expenses is based
on a gas price of $3.00 Mcf (NYMEX) for the year 2002.

     5. Nuevo entered into three interest rate swap contracts to
hedge the fair value of the 9-1/2% Senior Subordinated Notes
due June 1, 2008 and the 9-3/8% Senior Subordinated Notes due
October 1, 2010. These interest rate swap contracts are
designated as fair value hedges pursuant to SFAS No. 133 and
they remain in effect through the maturity dates of the
previously mentioned Notes.

          -- Under the contract terms for the 9-3/8% Notes, the
counter party pays Nuevo a weighted average fixed annual rate of
9-3/8% on the notional amount. Under the first contract, Nuevo
pays the counter party a variable annual rate equal to the
three-month LIBOR plus a weighted average rate of 3.49% on $50
million of debt. Under the second contract, Nuevo pays the
counter party a variable annual rate equal to the six-month
LIBOR plus a weighted average rate of 3.49% on $100 million of
debt.

          -- Under the contract terms for the 9-1/2% Notes, the
counter party pays Nuevo a weighted average fixed annual rate of
9-1/2% on $50 million of debt and Nuevo pays the counter party a
variable annual rate equal to the six-month LIBOR plus a
weighted average rate of 3.92%.

Estimates and Assumptions:

"The financial and operating guidance contains estimates and
assumptions that we believe are reasonable. We caution that
these estimates and assumptions are based on currently available
information as of August 6, 2002. We are not undertaking any
obligation to update these estimates as conditions change or as
additional information becomes available.

"All of the estimates and assumptions set forth in this document
constitute forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, Section 21E of the
Securities Exchange Act of 1934 and the Private Securities
Litigation Reform Act of 1995. Although we believe that these
forward-looking statements are based on reasonable assumptions,
we can give no assurance that our expectations will in fact
occur and caution that actual results may differ materially from
those in the forward-looking statements. These statements are
subject to a number of risks including:

     -- Price volatility - The price of oil, gas and liquids are
subject to large fluctuations in response to relatively minor
changes in the supply of and demand for oil, gas and liquids,
market uncertainty and a variety of additional factors beyond
Nuevo's control. Any substantial or extended decline in
commodity prices would have an adverse effect on Nuevo.

     -- Production - In general, production volumes are subject
to curtailments, delays, and cancellations as a result of a lack
of capital or other problems such as: weather, compliance with
governmental regulations or price controls, electrical
shortages, mechanical difficulties or shortages or delays in the
delivery of equipment. Changes to the capital budget and
exploratory drilling success will also have an impact on
production volumes.

     -- Exploration - Unanticipated problems or successes
encountered during the exploration for oil and gas. Exploration
costs are an inherently difficult expense category to estimate
and this estimate can be volatile due to the number of wells
drilled, completed and the success rate in any given quarter and
any potential changes to the capital budget.

     -- Uncertainty of estimates of oil and gas reserves.

     -- Ability of the company to implement its business plan.

     -- Political and environmental risks.

     -- Governmental regulation.

     -- Competition.

"These estimates also assume that we will not engage in any
material transactions such as acquisitions or divestitures of
assets, formation of joint ventures or sale of debt or equity
securities. We continually review these types of transactions as
part of our corporate strategy, and may engage in any of them
without prior notice."

These and other risk factors are described in the Company's
report on Form 10-K for the year-ended December 31, 2001.

Nuevo Energy Company is a Houston, Texas-based company primarily
engaged in the acquisition, exploitation, development,
production, and exploration of crude oil and natural gas.
Nuevo's domestic properties are located onshore and offshore
California. Nuevo is the largest independent producer of oil and
gas in California. The Company's international properties are
located offshore the Republic of Congo in West Africa and
onshore the Republic of Tunisia in North Africa. To learn more
about Nuevo, please refer to the Company's internet site at
http://www.nuevoenergy.com  

                         *    *    *

As reported in Troubled Company Reporter's July 3, 2002,
edition, Nuevo Energy Company monetized several non-core
assets and it is using the proceeds to repay a portion of its
outstanding bank debt.

The transactions are as follows:

      --  Nuevo has conveyed its interest in the Santa Ynez Unit
(SYU) to ExxonMobil Corporation for $16.5 million. The
conveyance settles the lawsuit filed by Nuevo in April 2000
concerning its right to participate in the Sacate Field, located
offshore Santa Barbara County, California. As part of the
settlement, Nuevo also conveyed its non-consent interest in the
adjacent Pescado Field, operated by ExxonMobil as part of the
SYU.

      --  Nuevo has settled the lawsuit Thomas Wachtell et al.
v. Nuevo Energy Company et al. filed in the Superior Court of
Los Angeles County, California. The settlement resolved
outstanding issues with respect to several of Nuevo's offshore
California fields in which the plaintiffs owned interests,
including the Sacate and Pescado Fields.

      --  Nuevo has sold its non-core onshore Gulf Coast assets
to Hilcorp Energy Company for $9.3 million, subject to the
exercise of preferential rights and final adjustments. The main
properties sold include Nuevo's interest in the North Rucias
Field in Brooks County, Texas, the North Frisco City Field in
Monroe County, Alabama, and the Giddings Field in Grimes County,
Texas. At year-end 2001, onshore Gulf Coast reserves accounted
for less than 1% of Nuevo's reserves. The current daily
production from these assets is approximately 860 barrels of oil
equivalent (BOE).


OGLEBAY NORTON: S&P Drops Corp. Credit & Bank Loan Ratings to B
---------------------------------------------------------------
Standard & Poor's lowered its corporate credit and bank loan
ratings on Oglebay Norton Co., to single-'B' from single-'B'-
plus due to difficult end-market conditions, the company's weak
financial performance, and its limited free cash-flow
generation, which will continue to result in high debt levels.

Cleveland, Ohio-based Oglebay's reported debt outstanding was
about $409 million as of June 30, 2002. The outlook is negative.

The ratings reflect Oglebay's very high debt leverage, cyclical
end markets, high capital spending requirements relative to
operating cash flow, and refinancing risk. The ratings also
reflect the company's diversified business segments and a focus
on productivity and operational improvements.

"Should debt leverage continue to increase, credit protection
measures weaken further, or refinancing become problematic,
ratings would be downgraded," said Standard & Poor's credit
analyst Eugene Williams.

Oglebay supplies minerals and aggregates to a variety of highly
cyclical and competitive markets, including building materials,
construction, environmental, energy, and metallurgical markets.
The company comprises three business segments: Great Lakes
Minerals, Global Stone, and Performance Minerals.

Performance in the Great Lakes Minerals segment, which accounted
for 37% of 2001 revenue, has been weak due to lower shipments of
iron ore to the steel industry, which has undergone difficult
industry conditions. Shipments are improving marginally due to
higher water levels and improvements in the steel industry. In
addition, the Global Stone segment, including the Lime and
Filler division, has been affected by weaker demand,
particularly for filler in both carpet and flooring markets.
This is being offset, to some degree, by increased shipments of
lawn and garden products and the roofing industry.


ONVIA.COM INC: Regains Compliance with Nasdaq Listing Guidelines
----------------------------------------------------------------
Onvia.com, Inc. (Nasdaq: ONVI; ONVID through August 14, 2002),
helping businesses secure government contracts and government
agencies find suppliers online, regained compliance with all the
listing requirements of the Nasdaq National Market.

On August 2, 2002, Nasdaq notified the Company that the
Company's stock would continue to be listed on the Nasdaq
National Market. "Now that we have regained compliance with the
Nasdaq National Market's listing requirements, we believe that
our stock will be more attractive to prospective investors,"
stated Michael Pickett, chairman and chief executive officer.

In May, 2002 the Company was notified that its common stock had
failed to maintain a minimum closing bid price of $1.00 during
the 90 day period ending on May 15, 2002, as required by Nasdaq
Marketplace Rule 4450. As a response, on May 17, 2002, Onvia
filed an appeal before the Nasdaq Listing Qualifications Panel
and instituted a 1-for-10 reverse stock split to remain listed
on the Nasdaq National Market. The reverse stock split was
approved by Onvia's Board of Directors, and subsequently by its
shareholders at the Company's annual meeting on July 11, 2002.

After the Nasdaq Listing Qualifications Panel hearing held on
June 20, 2002, the Company was notified that its shares had to
trade above $1.00 on the close of the effective date of the
reverse stock split and for ten consecutive trading days
thereafter to remain listed with the Nasdaq National Market. On
July 17, 2002 or the effective date of the reverse stock split,
Onvia's stock closed at $2.15 and in the range of $2.05 to $2.58
during the following ten consecutive trading days.

Onvia.com, Inc., helps businesses secure government contracts
and government agencies find suppliers online. Onvia assists
businesses in identifying and responding to bid opportunities
from more than 50,000 government purchasing offices in the $600
billion federal, state, and local government marketplace. Onvia
also manages the distribution and reporting of requests for
proposals and quotes from more than 400 government agencies
nationwide. The size and strength of Onvia's network allows
suppliers and agencies to find better matches quickly, saving
time and money. For more information, contact Onvia.com, Inc.:  
1260 Mercer St., Seattle, WA 98109. Tel:  206-282-5170, fax:  
206-373-8961, or visit http://www.onvia.com  


PAC-WEST TELECOMM: Second Quarter EBITDA Drops 18.6% to $8.3MM
--------------------------------------------------------------
Pac-West Telecomm, Inc. (Nasdaq: PACW), a provider of integrated
communications services to service providers and business
customers in the western U.S., announced its results for the
second quarter 2002.

Wally Griffin, Pac-West's Chairman and CEO, said, "Our second
quarter set a new company record for new lines in service,
62,436 lines, or a 24.2% increase, from the previous quarter.  
These market share gains are a strong and unmistakable
endorsement of Pac-West by our customers."

Griffin continues, "In light of recent events in our industry,
Pac-West is not only differentiated by our strong financial
performance and market share, we're also differentiated by the
way we do business.  While a crisis in confidence is apparently
justified among the investing public, we are confident that the
more investors scrutinize our industry, the more Pac-West stands
apart from the crowd."

Hank Carabelli, Pac-West's President and COO, commented, "Our
continued capture of market share while containing costs is
validation of our business model and ability to execute on plan.  
We are focused on maximizing our positive cash flows, for which
we use EBITDA as a proxy.  The investment community has come to
realize that not all revenues are equally valuable, once you
have accounted for the costs required to generate those sales
and the long-term strategic value to the company.  Revenues only
make sense if they cover their costs and contribute to corporate
profitability.  Similarly, bottom-line net income measurements
are impacted by a number of non-cash factors such as
depreciation, asset write-downs, etc.  For these reasons, we
believe that the most important measurement of our company's
success is cash flow.  Two metrics that we run our business by
are EBITDA/Expenses and EBITDA/Assets.  Our entire organization
is focused on these as the ultimate productivity measurements
for decision-making and compensation.  It is our relentless
focus on accelerating cash flow and increasing customer
satisfaction that continue to differentiate Pac-West from other
telecommunications providers."

                         Lines in Service

Pac-West achieved record quarterly line installations of 62,436
new lines in the second quarter. Total DS0 equivalent lines in
service, which include wholesale and on-network retail DS0 line
equivalents, were 320,042 at the end of the second quarter of
2002, a 24.2 percent sequential increase from 257,606 lines at
the end of the first quarter of 2002, and a 35.5 percent year-
over- year increase from 236,193 lines at the end of the second
quarter of 2001.

Wholesale DS0 equivalent lines were 271,802 at the end of the
second quarter of 2002, a 26.9 percent sequential increase from
214,145 lines at the end of the first quarter of 2002, and a
35.9 percent year-over-year increase from 199,975 lines at the
end of the second quarter of 2001.

Retail on-network DS0 equivalent lines were 48,240 in the second
quarter of 2002, an 11.0 percent sequential increase from 43,461
lines at the end of the first quarter of 2002, and a 33.2
percent year-over-year increase from 36,218 lines at the end of
the second quarter of 2001.

                           Revenues

Pac-West's total revenues for the second quarter 2002 were $38.5
million, a 10.7 percent decrease from revenues of $43.1 million
in the first quarter of 2002.  Included in first quarter 2002
revenues was a large settlement payment of $4.8 million from
Verizon Communications, ruled by the California Public Utilities
Commission to be improperly withheld for the delivery of
Internet-bound telephone traffic.  Excluding this settlement
payment, sequential revenues increased by 0.5 percent from the
first quarter to the second quarter of 2002.  Second quarter
2002 revenues increased by 0.8 percent from revenues of $38.2
million in the second quarter of 2001.

Pac-West is currently in active parallel Interconnection
Agreement negotiations and arbitration proceedings with SBC
Communications in California, which will determine a number of
revenue and cost elements, including reciprocal compensation
rates for local traffic. Pac-West is also involved with
arbitration of an ICA with Verizon Communications.  Both
agreements are anticipated to be implemented by the end of 2002.

On May 16, 2002, the CPUC implemented a UNE (Unbundled Network
Element) pricing structure for local traffic in California.  A
regulatory hearing is underway to determine the appropriate rate
elements and costs for interconnecting local traffic between
carriers in the state of California. This resulted in an
approximate $3.1 million reduction in May and June 2002 combined
revenues billed by Pac-West pending regulatory clarity and a
finalized interconnection agreement.  These revenues are not
reflected in Pac-West's second quarter financial statements due
to the current uncertainty of collection, and if collectible,
Pac-West will recognize such collections when payment is
received.

                           Expenses

Significant line growth in 2002 resulted in increased
installation and transport expenses.  Operating expenses
increased by 1.4 percent, from $13.8 million in the first
quarter of 2002 to $14.0 million in the second quarter of 2002,
but decreased by 1.4 percent from $14.2 million in the second
quarter of 2001 as a result of expense reduction efforts.  S,G&A
expenses increased by 13.3 percent from $14.3 million in the
first quarter of 2002 to $16.2 million in the second quarter of
2002, but declined by 9.0 percent from $17.8 million in the
second quarter of 2001.

Credit and collection efforts resulted in a continuation of DSO
(days sales outstanding) improvement, declining to 34 days at
the end of the end of the second quarter of 2002 from 40 days at
the end of the first quarter of 2002, and 56 days at the end of
the second quarter of 2001.

                              EBITDA

Adjusted EBITDA (earnings before interest, net, income taxes,
depreciation and amortization, excluding restructuring charges,
goodwill impairment, and income or loss on asset dispositions)
for the second quarter of 2002 was $8.3 million, an 18.6 percent
decrease from adjusted EBITDA of $10.2 million for the first
quarter of 2002, which excludes the settlement of $4.8 million
from Verizon.  Second quarter 2002 adjusted EBITDA increased by
36.1 percent year-over-year from $6.1 million in the second
quarter of 2001.

                         Net Income (Loss)

Net loss for the second quarter of 2002 was $13.4 million,
compared to net income of $7.4 million for the first quarter of
2002, and a net loss of $3.6 million for the second quarter of
2001.  A gain on redemption of bonds of $7.2 million, net of
taxes of $4.7 million, was recognized in the first quarter of
2002 relating to open market purchases undertaken to retire
$21.0 million principal amount of Senior Notes at a significant
discount from face value.  This resulted in an annual interest
payment reduction of approximately $2.8 million.  A settlement
of $4.8 million from Verizon was also received in the first
quarter of 2002.

In keeping with Pac-West's efforts to maximize asset utilization
and minimize capital outlays, underutilized switching equipment
from our Denver, Colorado facility has been moved to satisfy
immediate demand at our Oakland, California facility.  This
office closure resulted in period charges against net income of
$9.3 million for restructuring charges.

In accordance with the Statement of Financial Accounting
Standards ("SFAS") No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets" the Company reviewed its ability
to recoup its asset costs on a market-by-market basis.  Due to
current economic conditions in some of the Company's markets
outside of California, the Company determined that certain of
the Company's leasehold improvements met the definition of an
impaired asset under SFAS No. 144.  Accordingly, the Company
recorded a one-time impairment charge for the specific assets
involved of approximately $7.2 million.

Diluted net loss per share for the second quarter of 2002 was
$0.37, as compared to net income of $0.20 in the first quarter
of 2002, and a net loss of $0.10 in the second quarter of 2001.

                         Liquidity

As of June 30, 2002, the Company had cash and short-term
investments totaling $64.4 million, a decrease of $0.5 million
from $64.9 million in cash as of March 31, 2002.  Cash was
utilized to retire the $10.0 million outstanding on a senior
credit facility, pay down $8.6 million, or half of our remaining
IRU (Indefeasible Right of Use) obligation, as well as to fund
capital expenditures and business operations.  Pac-West is
currently reviewing its debt obligations and is considering
various alternatives to continue to reduce such obligations and
borrowing costs, including, among other things, the purchase of
additional Senior Notes.  The manner, volume and timing of such
purchases, if any, would depend on then current market
conditions for our Senior Notes.

                         *    *    *

As reported in Troubled Company Reporter's January 25, 2002
edition, Standard & Poor's lowered its corporate credit and
senior secured bank loan ratings on Pac-West Telecomm Inc. to
triple-'C' from single-'B'-minus. The rating on the $150 million
senior unsecured notes due 2009 was also lowered to double-'C'
from triple-'C'. The ratings remain on CreditWatch with negative
implications.

The downgrade is based on Standard & Poor's increased concerns
that Pac-West may be challenged to have adequate funding for its
business plan beyond 2002 despite having taken measures to
reduce capital spending and overhead over the past year to
conserve capital.


PACIFIC GAS: IRS Confirms Tax-Free Reorganization Transactions
--------------------------------------------------------------
Pacific Gas and Electric Company has received a ruling from the
Internal Revenue Service confirming that the transactions
contemplated under the utility's proposed plan of reorganization
would, if implemented, constitute a tax-free reorganization
under Section 368 of the Internal Revenue Code.

Receipt of this ruling is very important, as the applicable tax
law is exceedingly complex and the tax liability would have been
substantial if the proposed reorganization were taxable. This
federal income tax issue was identified in the utility's
Disclosure Statement approved by the U.S. Bankruptcy Court for
circulation to creditors.

This IRS ruling applies only to PG&E's proposed plan of
reorganization, and does not address any other plan.


PERSONNEL GROUP: Affiliate's Name Changed to Venturi Staffing
-------------------------------------------------------------
Personnel Group of America, Inc., (NYSE:PGA) announced that its
Thomas Staffing unit has changed its name to Venturi Staffing
Partners. The change is effective immediately and is part of a
PGA branding strategy that will leverage the combined strength
of PGA's multi-branch Southern California operations with its
other operations across the country.

Since 1969, Thomas Staffing has served the Southern California
market with a wide variety of office professional staffing
solutions through branch offices from San Diego to the San
Fernando Valley.

"Our new name underscores the value we place on our customer and
associate partnerships and signifies the unified focus of our
multi-branch operation in Southern California and across the
country," said Doug Slack, Vice President of the Western Region.

Although the public face of these operations will take on a new
look through the Venturi Staffing Partners name, Slack maintains
their core operating philosophies will not change. "We will
continue to focus on each customer's unique needs and will
maintain a flexible service approach that allows us to respond
quickly and effectively to the evolving business requirements of
the Southern California market," said Slack.

The famous 18th century Italian Physicist Giovanni Venturi,
known for his groundbreaking work in fluid mechanics, inspired
the Venturi name. "The name serves as a metaphor for the service
we provide our clients. Much like a true venturi, we speed
needed resources to our clients and remove the pressures they
experience with their staffing needs," explained Slack.
"Although the company name has changed, our commitment to
service excellence remains steadfast. We take pride in working
to ensure that the 'Venturi Staffing Partners' name remain
synonymous with quality staffing solutions recognized as
Southern California's premier staffing service."

Personnel Group of America, Inc., is a nationwide provider of
information technology consulting and custom software
development services; high-end clerical, accounting and other
specialty professional staffing services; and technology systems
for human capital management. The Company's IT Services
operations now operate under the name "Venturi Technology
Partners" and its Commercial Staffing operations are being
rebranded "Venturi Staffing Partners" over the balance of 2002.

                         *     *     *

As reported in the Monday edition of Troubled Company Reporter,
Personnel Group of America said it is "working hard to remain in
compliance with the New York Stock Exchange listing standards."
The Company continues to be monitored by the NYSE for compliance
with the business plan we submitted to the NYSE earlier this
year. The weak equity market and the balance sheet reduction in
shareholders' equity caused by the adoption of SFAS 142 have now
resulted in the Company dipping below the NYSE's $1.00 minimum
trading price and $50.0 million total shareholders' equity
requirements.

"We are in ongoing discussions with the NYSE and are committed
to taking appropriate action to ensure that PGA's common shares
remain listed for trading, either on the NYSE or on another
stock exchange."

"Our quarterly results reflect improvements in a great many
areas," stated James C. Hunt, PGA's Chief Financial Officer. "We
are pleased with the improvements in our commercial staffing
overall business performance and with the increase in the
Company's overall EBITDA to $4.2 million in the second quarter,
up from $3.7 million in the first quarter. This increase and
strong balance sheet management allowed us to repay an
additional $6.3 million in senior debt this quarter.
Additionally, we had cash on hand at the end of the second
quarter of $25.3 million, which preserves the Company's
negotiating options during discussions examining alternatives
for debt restructuring. Should those discussions not lead to a
near-term outcome, that cash on hand will be applied to debt
repayment. Adopting SFAS 142 will not have an impact on our cash
flow or continued compliance with the financial covenants in our
bank credit agreement."


PHOTOCHANNEL NETWORKS: Raises $850,000 through Private Placement
----------------------------------------------------------------
PhotoChannel Networks Inc. (TSX: PNI), a global digital imaging
network company, has closed and completed a private placement of
$854,200.

As previously announced May 1, 2002, subscriptions and funds
have received for 8,542,000 units at a price of CDN$0.10 per
unit for gross proceeds of $854,200. Each unit will consist of
one common share and one common share purchase warrant, each of
which, and the shares underlying the warrants, will be subject
to a four month hold period from the date of issuance of the
units. The common share purchase warrant will entitle the
holder to purchase one additional common share of PhotoChannel
at the exercise price of CDN$0.10 for a period of one year from
closing.

PhotoChannel is a technology producer and integrated provider of
services enabling retailers and other members of the
PhotoChannel Network to meet the needs of their film and digital
photography customers. PhotoChannel has created and manages the
PhotoChannel Network environment whose focus is delivering photo
e-processing orders from origination to fulfillment under the
control of the originating retailer. Additional information is
available at http://www.photochannel.com

PhotoChannel filed for Chapter 7 Liquidation on November 1,
2001, in the U.S. Bankruptcy Court for the District of
Connecticut in Bridgeport.


PREVIO INC: Files Prelim. Dissolution Proxy Statement with SEC
--------------------------------------------------------------
Previo, Inc., (Nasdaq: PRVO) filed a preliminary proxy statement
with the Securities and Exchange Commission seeking stockholder
approval for the Company's dissolution and distribution of
assets to its stockholders.  

As previously announced, after disappointing sales and after an
extensive consideration of other strategic alternatives,
including mergers or asset sales with potential business
partners, Previo's Board of Directors approved the dissolution
and liquidation of the Company.  Consequently Previo has
terminated all of its employees except for four employees who
will handle matters related to the expected dissolution and
except for its employees in its Estonia office.  As also
previously announced, the Company has entered a definitive
agreement with Altiris, Inc. pursuant to which the Company will
sell substantially all of its non-cash assets to Altiris for
approximately $1 million, pending stockholder approval.  As part
of this transaction, the costs for Previo's Estonian based
developmental organization are being fully funded by Altiris.

The Company estimates that there will be between $2.38 and $2.64
per outstanding share of common stock available for distribution
to stockholders, after payment of all liabilities and expenses
associated with the plan of dissolution and otherwise.  The
actual amount available for distribution, if any, could be
substantially less, depending on a number of factors that are
discussed more fully in the preliminary proxy statement.

In the event the plan of dissolution is approved by Previo's
stockholders, the Company currently anticipates that it will
petition the Delaware Court of Chancery in connection with the
dissolution seeking an early initial distribution of
approximately $2.09 per outstanding share of common stock as
soon as practicable.  However, the timing and amount of the
distributions are within the discretion of the Delaware Court of
Chancery and cannot be predicted with certainty, nor is there
any certainty that the Delaware Court of Chancery will allow any
early distribution.  The Company currently anticipates that this
initial distribution will be made to stockholders approximately
200 days after the filing of the certificate of dissolution with
the Delaware Secretary of State.  This filing is anticipated to
take place on or about the date for the special stockholders'
meeting called for the purpose of approving the dissolution.  
However, if there are no claims other than those that we
anticipate, the initial distribution may be sooner and if there
are claims that we do not anticipate, the initial distribution
may be later.

The Company urges readers to review its preliminary proxy
statement for full details including information related to the
risks and uncertainties associated with the dissolution plan,
amounts available for liquidation and distribution to
stockholders, and the expected timing of any such liquidating
distributions.

The Company also filed with the Securities Exchange Commission
its report on Form 10-Q for the third fiscal quarter ended June
30, 2002.  The financial information for the quarter and nine
months ended June 30, 2002 is summarized below.

                          Balance Sheet

Cash and short-term investments were $16.2 million at June 30,
2002, a $3.4 million decrease from September 30, 2001.  The
decrease was primarily due to cash used in operations, and was
partially offset by $0.6 million received pursuant to the legal
settlements discussed below.  Based on outstanding shares of
6,890,559 at June 30, 2002 there is $2.35 per outstanding share
in cash and liquid investment assets.

Income taxes receivable of $2.6 million at June 30, 2002
represents federal income tax refunds associated with amended
prior year returns for net operating loss carry-back benefits.

                            Revenues

The Company reported total revenues of $0.5 million for the
quarter ended June 30, 2002 and  $2.1 million for the nine
months ended June 30, 2002, compared to revenues of $1.6 million
and $5.4 million in the quarter and nine months ended June 30,
2001, respectively.  Net loss for the June 2002 quarter was $2.1
million, compared to a net loss of $2.3 million in the June 2001
quarter.  There was a net loss of $2.6 million during the nine
months ended June 30, 2002, compared to a net loss of $5.1
million for the nine months ended June 30, 2001.

                         Operating Expenses

Operating expenses were $2.5 million in the quarter ended June,
2002, compared to operating expenses of $4.0 million in the
quarter ended June 30, 2001, and were $7.7 million in the nine
months ended June 30, 2002 compared to $11.2 million in the nine
months ended June 30, 2001.  Operating expenses for the three
and nine months ended June 30, 2002 included $1.6 million and
$2.5 million, respectively, in net restructuring and asset
write-down charges.  The $1.6 million charge in the June 2002
quarter represents expense for severance and benefits paid or
accrued for employees terminated or to be terminated as a result
of the Company's recently announced sale of its core business
and pending dissolution, as discussed more fully in its press
release dated July 16, 2002.  Additionally, the charge includes
estimated lease termination costs related to the Company's San
Diego, California office.  The $2.6 million charge for the nine
months ended June 30, 2002, includes these charges as well the
write-down of fixed assets to fair value and additional
severance and benefits related to the Company's December 2001
restructuring.

The decrease in aggregate operating expenses for the three and
nine month periods is primarily a result of cost reductions from
restructuring activities that had been initiated to better align
expenses with revenue expectations, and from cost reductions
associated with the proposed sale of substantially all of the
Company's non-cash assets and pending dissolution.

                    Interest and Other Income

Interest and other income for the quarter and nine months ended
June 30, 2002 was  $0.1 million and $0.9 million, respectively,
compared to $0.3 million and $1.1 million in the quarter and
nine months ended June 30, 2001, respectively.  The decrease in
interest and other income in the nine months ended June 30, 2002
from the nine months ended June 30, 2001, was primarily due to
lower interest income resulting from lower interest rates and
lower invested balances, partially offset by the one time
receipt of $0.6 million from the Company's settlement of its two
intellectual property lawsuits.

                           Income Taxes

The $2.8 million benefit from income taxes recognized during the
nine months ended June 30, 2002 is primarily due to a recent
change in federal income tax law, allowing the Company to recoup
taxes paid in previous years by extending the carry-back period
for certain net operating losses.

Previo (Nasdaq: PRVO) has been an innovator of products that fix
everyday PC problems for enterprises and small businesses. The
Company entered into an agreement with Altiris, Inc., pursuant
to which the Company will sell substantially all of its non-cash
assets to Altiris, pending stockholder approval.  In addition,
the Company entered into a license agreement with Altiris in
June 2002, which grants Altiris rights to the Company's assets
and intellectual property, and a services agreement pursuant to
which Altiris is reimbursing Previo for its expenses associated
with its facility in Estonia. These agreements are discussed
more fully in the Company's Notice of Special Meeting of
Stockholders and accompanying preliminary proxy statement which
are being filed with the Securities and Exchange Commission on
August 6, 2002.

For more information, contact Previo by telephone (858)793-2800.


PUEBLO XTRA: S&P Assigns D Rating after Interest Non-Payment
------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on supermarket operator Pueblo Xtra International Inc.,
(now Nutritional Sourcing Corp.) to 'D' from double-'C' based on
the company not making the August 2, 2002, interest payment on
its $177 million senior unsecured notes due in 2003. The senior
unsecured debt rating was also lowered to 'D' from single-'C'.
Standard & Poor's also affirmed its triple-'C' senior secured
bank loan rating on Pompano Beach, Florida-based Pueblo. The
bank loan rating will be lowered to 'D' if the company files for
bankruptcy or becomes in default of its loan agreement.

"Pueblo has faced marginal liquidity and a highly competitive
marketplace as it has addressed the prospects of refinancing its
bank loan, which matures in February 2003, and its senior notes,
which mature in August 2003," Standard & Poor's credit analyst
Patrick Jeffrey said.


REPEATER TECHNOLOGIES: Nasdaq Will Delist Shares by August 13
-------------------------------------------------------------
Repeater Technologies Inc. (Nasdaq:RPTR), a leading provider of
coverage enhancement products and engineering services to
wireless carriers worldwide, announced that on Aug. 5, 2002 it
received notification from The Nasdaq Stock Market Inc.,
indicating that the company's common stock had not maintained a
minimum market value of publicly held shares of $5,000,000 and a
minimum bid price per share of $1.00, as required by Nasdaq
Marketplace Rules 4450(a)(2) and 4450(a)(5), over 30 consecutive
trading days, and had not regained compliance during the 90 days
provided under Marketplace Rules 4450(e)(1) and 4450(e)(2).

As a result of the company's inability to regain compliance in
accordance with Marketplace Rules 4450(e)(1) and 4450(e)(2),
Nasdaq notified the company that its securities would be
delisted from The Nasdaq National Market at the opening of
business on Aug. 13, 2002.

Repeater Technologies also stated that it has withdrawn its
application to transfer to The Nasdaq SmallCap Market and does
not intend to request review of Nasdaq's delisting decision as
permitted by Nasdaq's rules.

Repeater Technologies, with headquarters in Sunnyvale, develops,
markets and sells wireless coverage enhancement solutions
primarily to wireless service providers. The company provides
cost-effective, high-quality coverage systems and services that
can be used in suburban, rural and urban areas and in coverage-
limited structures.

To learn more, visit the company's Web site at
http://www.repeaters.com To reach the Investor Relations  
department, call 408/743-9444.


TYCO INT'L: Names Eric Pillmore as Sr. VP - Corporate Governance
----------------------------------------------------------------
Tyco International Ltd., (NYSE: TYC, BSX: TYC, LSE: TYI) has
appointed Eric M. Pillmore to the newly created position of
Senior Vice President of Corporate Governance, effective
immediately.  Mr. Pillmore has been serving as the Senior Vice
President, CFO and Secretary of Multilink Technology
Corporation.

Ed Breen, newly appointed Chairman and Chief Executive Officer
of Tyco, said, "I have made an absolute commitment to
establishing the highest standards of corporate governance in
every aspect of this company's financial reporting, operations
and management. The appointment of Eric to the new position of
Senior Vice President of Corporate Governance underscores that
commitment.  His two decades of experience in key financial and
audit positions, primarily with General Electric and General
Instrument, have provided him with a very sophisticated
understanding of a wide variety of governance, financial and
management issues. Eric's credentials for the job are impeccable
and he has a well-earned reputation for integrity, precision
and diligence in all that he does."

Mr. Breen continued, "I worked closely with Eric at General
Instrument, where he was my CFO.  From my own personal
experience with his uncompromising professionalism, I know Eric
is the ideal person to be Tyco's senior corporate governance
officer and an integral member of the team that will lead this
Company forward."

Mr. Pillmore said, "I am thrilled to be joining the Tyco
leadership team. This company has a solid foundation of
operating businesses, and my new job presents a tremendous
opportunity to work with Ed and all the people of Tyco to build
on its many strengths and realize its true potential. In
particular, I am very excited about the opportunity to help Tyco
establish the highest standards of corporate governance and
ethics."

Mr. Pillmore added, "In the coming weeks, I will be working
closely with Ed and the rest of his team to develop a specific
action plan to address Tyco's top priorities: restoring
confidence in the Company with our employees, suppliers,
customers and the financial community; enhancing and
strengthening the core businesses; ensuring that we have the
highest standards of corporate governance in place; and creating
value for shareholders."

Mr. Pillmore has been serving as the Senior Vice President,
Chief Financial Officer and Secretary of Multilink Technology
Corporation since July 2000.  Multilink is a leading provider of
advanced semiconductor based components, modules and higher-
level assemblies for use in high-speed optical networks.  Mr.
Pillmore also has been Chief Financial Officer and Vice
President of Finance and Administration for McData Corporation
and Senior Vice President of Finance and Director for the
Broadband Communications Sector of Motorola Corporation, the
successor by acquisition to General Instrument Corporation, or
GI.

Mr. Pillmore worked for GI from 1996 to 2000, ultimately holding
the position of Senior Vice President of Finance and Chief
Financial Officer. From January 1994 to February 1996, he was
Manager of Finance for the Plastics Americas Division of General
Electric Company. Prior to that, he served as Manager of Finance
for GE Medical Systems Asia, Ltd., as well as Director of
Finance for GE/Yokogawa Medical Systems, Ltd. He had worked in
various financial positions for GE since 1979, including six
years as GE Corporate Auditor from 1981 to 1987.

Pillmore is a 1975 graduate of the University of New Mexico,
Albuquerque, NM, with a BBA from the Andersen School of
Business.  He has been married to his wife Pamela for 23 years
and they have five children.  Mr. Pillmore currently resides in
Doylestown, PA.
    
Tyco International Ltd., is a diversified manufacturing and
service company. Tyco is the world's largest manufacturer and
servicer of electrical and electronic components; the world's
largest designer, manufacturer, installer and servicer of
undersea telecommunications systems; the world's largest
manufacturer, installer and provider of fire protection systems
and electronic security services; and the world's largest
manufacturer of specialty valves. Tyco also holds strong
leadership positions in disposable medical products and plastics
and adhesives. Tyco operates in more than 100 countries and had
fiscal 2001 revenues from continuing operations of approximately
$34 billion.

At June 30, 2002, Tyco's balance sheet shows that its total
current liabilities eclipsed its total current assets by about
$2 billion.


TYCO INTL: Appoints Ex-Dupont CEO/Chairman John Krol to Board
-------------------------------------------------------------
Tyco International Ltd., (NYSE: TYC, BSX: TYC, LSE: TYI) has
appointed John A. Krol, the former Chairman and Chief Executive
of E.I., du Pont de Nemours & Company, to Tyco's Board of
Directors.

Ed Breen, the newly appointed Chairman and CEO of Tyco, said,
"Jack Krol personifies the highest standards of corporate
leadership. He has an international reputation not only for his
intellect and business skills but also for his honesty and
integrity.  I have committed Tyco to establishing the best
corporate governance practices, while also building our
businesses for our shareholders, employees and customers.  As a
new member of our Board of Directors and a valued advisor to me
and our management team, Jack Krol will be a key figure in
helping achieve both of those goals.  I have the greatest
respect and admiration for Jack's many accomplishments over the
years and welcome him to the Board."

Mr. Krol, 65, joined E.I. du Pont de Nemours & Company in 1963
as a chemist, working his way up through the company to senior
management positions, and was appointed Vice Chairman of the
company in 1992 and Chairman and CEO in 1998.  E.I. du Pont
Nemours is a global research and technology-based company
serving worldwide markets, including food and nutrition, health
care, agriculture, fashion and apparel, home and construction,
electronics and transportation.

Mr. Krol also serves on the Board of Directors for Ace Ltd.,
Armstrong Holdings, Inc., MeadWestvaco Corporation, Milliken &
Company and Molecular Circuitry, Inc.
    
Tyco International Ltd., is a diversified manufacturing and
service company. Tyco is the world's largest manufacturer and
servicer of electrical and electronic components; the world's
largest designer, manufacturer, installer and servicer of
undersea telecommunications systems; the world's largest
manufacturer, installer and provider of fire protection systems
and electronic security services; and the world's largest
manufacturer of specialty valves. Tyco also holds strong
leadership positions in disposable medical products and plastics
and adhesives. Tyco operates in more than 100 countries and had
fiscal 2001 revenues from continuing operations of approximately
$34 billion.

                         *   *   *

As previously reported, Standard & Poor's Ratings Services said
that its ratings, including its triple-'B'-minus corporate
credit rating, on Tyco International Ltd., and its subsidiaries
remain on CreditWatch with negative implications following the
company's recent earnings announcement, appointment of a new
CEO, and denial of bankruptcy rumors.

Hamilton, Bermuda-based Tyco is a diversified company with total
debt of about $26 billion.

Standard & Poor's noted that Tyco began the quarter with more
than $7 billion in cash following the recent IPO of its
commercial finance subsidiary. Management intends to use a
significant portion of this to reduce debt. Recent earnings were
broadly in line with expectations, but free cash flow was below
expectations due to tighter payment terms from suppliers that
reduced operating cash flow by more than $300 million.


TYCO INTL: Nixes Proxy Statement Proposing Board Size Increase
--------------------------------------------------------------
Tyco International Ltd., (NYSE: TYC, BSX: TYC, LSE: TYI) will
not go forward at this time with its previously announced proxy
statement, which proposed an increase in the maximum size of the
Board of Directors from 11 to 15 directors.

As announced last week, Ed Breen, Tyco's newly appointed
Chairman and Chief Executive Officer, has initiated a
comprehensive review of corporate governance at Tyco and will
work with the Board to determine appropriate actions to be
taken, including changes to the composition of the Board.  Mr.
Breen has made an absolute commitment to addressing governance
matters quickly and effectively.  His stated goal is to make the
Company a leader in instituting a "best practices" approach to
corporate governance.
    
Tyco International Ltd., is a diversified manufacturing and
service company. Tyco is the world's largest manufacturer and
servicer of electrical and electronic components; the world's
largest designer, manufacturer, installer and servicer of
undersea telecommunications systems; the world's largest
manufacturer, installer and provider of fire protection systems
and electronic security services; and the world's largest
manufacturer of specialty valves. Tyco also holds strong
leadership positions in disposable medical products and plastics
and adhesives. Tyco operates in more than 100 countries and had
fiscal 2001 revenues from continuing operations of approximately
$34 billion.

Tyco International Group's 6.875% bonds due 2002 (TYC02USR1),
DebtTraders reports, are trading at 96 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=TYC02USR1for  
real-time bond pricing.


W.R. GRACE: Has Until January 10, 2003 to Remove Pending Actions
----------------------------------------------------------------
David W. Carickhoff, Esq., at Pachulski Stang Ziehl Young &
Jones, in Wilmington, Delaware, tells Judge Fitzgerald that W.
R. Grace & Co., and its debtor-affiliates are named defendants
in 65,000 asbestos-related lawsuits in various state and federal
courts involving 232,000 different individual claims.  The
Debtors are also defendants in eight asbestos-related fraudulent
conveyance actions in various state and federal courts that
involve large numbers of individual claims.  There are numerous
other lawsuits, including, but not limited to environmental
actions, in which one or more of the Debtors and/or the Non-
Debtor Affiliates are named defendants in various state and
federal courts.  Many of these Asbestos Actions, Fraudulent
Conveyance Actions and Miscellaneous Actions were filed prior to
the Petition Date.

Accordingly, the Debtors sought and obtained a Court order
extending -- until January 10, 2003 -- the period during which
they may remove the prepetition actions to the District of
Delaware for continued litigation and resolution.

Since the Petition Date, a number of additional Asbestos
Actions, Fraudulent Conveyance Actions and Miscellaneous Actions
have been filed and continue to be filed.  The Debtors and its
Non-Debtor Affiliates believe that these Postpetition Actions
are void because they were filed in violation of the automatic
stay.

In the months since the Petition Date, Mr. Carickhoff reminds
the Court that the Debtors have attempted to address the central
task in these Chapter 11 cases, which is to determine the true
scope of the Debtors' liability to asbestos claimants and then
to provide for the payment of valid claims on a basis that
preserves the Debtors' still-strong core business operations.  
At a hearing on May 3, 2001, Judge Farnan directed the Debtors
to develop a specific proposal for adjudicating asbestos-related
litigation in these Chapter 11 cases.

The Debtors assert that the litigation protocol will streamline
the claims adjudication process by providing a means of
resolving the common legal issues through a fair and orderly
process in a single forum while preserving legitimate personal
injury claimants' rights to trial.  While this litigation
protocol will not completely eliminate the Debtors' need to
preserve the option to remove actions to this Court, it should
minimize the need to do so.   Nonetheless, until the claims
arising from the Actions have been resolved, whether through
this litigation protocol or otherwise, the Debtors must preserve
the option of removing Actions to this Court.

The extension of the removal period will give the Debtors and
the Non-Debtor Affiliates an opportunity to make fully informed
decisions and will assure that they do not forfeit valuable
rights of removal.  Mr. Carickhoff assures the Court that the
rights of the Debtors' adversaries will not be prejudiced by the
extension because, in the event that a matter is removed, the
other parties to the Actions to be removed may seek to have the
action remanded to the state court pursuant to 28 U.S.C. Sec.
1452(b). (W.R. Grace Bankruptcy News, Issue No. 26; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


WHOLE LIVING: Appoints Robert Thele as Company Senior Executive
---------------------------------------------------------------
Whole Living Inc., (OTCBB:WLIV) is proud to welcome Robert Thele
into Whole Living's family and look forward to his experience as
a senior executive as the Company begins rapidly expanding both
domestically and internationally.

"I have been involved with a lot of senior management and found
that Robert Thele has shown an extraordinary amount of
leadership and management abilities. His expertise will not only
help Vestrio in their field, but will help the whole
organization ultimately reach their visions for the
shareholders. We are very excited to welcome Bob and his
management team to the Whole Living family," stated Ron
Williams, President of Whole Living Inc.

Robert Thele currently is the President and Chief Executive
Officer of Vestrio Corp., a wholly-owned subsidiary of Whole
Living.  Mr. Thele is described as a creative and energetic
executive with a unique ability to frame the vision of the
company and attract and retain high-powered people.

Robert Thele was the driving force behind Covey Leadership
Center where he served as President and C.E.O. During his
tenure, Covey was the fastest growing leadership development
company in the world serving many Fortune 100 Companies along
with several renowned International Companies.

Under his leadership, Covey Leadership Center went from
bankruptcy, with six employees doing less than a million dollars
in sales, to a world-wide entity with over 700 employees and 100
million in annual revenues.

Prior to joining Vestrio Corp., Mr. Thele was the C.E.O. of
Sport Court Inc., an American Sports Product Group (ASPG)
company. Under his direction, ASPG's annual sales surged over
2000% as revenues went from 10 million to over 200 million in
five years.

"We have spent the last two months aligning our system with that
of The Brain Garden. This advancement in technology has laid the
foundation for the comprehensive launch of Vestrio Corp.," added
Robert Thele, President and Chief Executive Officer of Vestrio
Corp.  "Over the next few months we will unveil a comprehensive
marketing campaign both domestically and internationally."

Whole Living, Inc., (OTCBB: WLIV - News) is a premier whole-
foods nutrition company in the direct-selling industry, with
premium products reaching consumers throughout the US, Canada,
Japan, Australia and New Zealand.

Whole Living's March 31, 2002, balance sheet shows a total
shareholders' equity deficit of about $733,931.


WILLIAMS CONTROLS: Nixes Anti-Takeover Provisions from Charter
--------------------------------------------------------------
Williams Controls, Inc., is advising its stockholders of an
amendment to its Certificate of Incorporation accomplished with
the approval of certain of the Company's stockholders. The
Amendment will result in the Company not being governed by the
anti-takeover provisions of Section 203 of Delaware General
Corporation Law. The Information Statement is first being mailed
to stockholders on or about August 11, 2002. It is anticipated
that the Amendment will become effective on or after August 31,
2002.

On June 26, 2002, Williams' Board of Directors approved a
resolution authorizing the Company to file the Amendment with
the Delaware Secretary of State. On July 2 and 30, 2002, the
holders of a majority of the outstanding stock entitled to vote
on the Amendment executed written consents in accordance with
Section 228 of the General Corporation Law of the State of
Delaware approving and adopting the
Amendment.

Williams Controls is open to communication, but it's really into
control. The company's biggest business is making electronic
throttles, exhaust brakes, and pneumatic controls for trucks and
other heavy equipment. Other operations include microcircuits,
cable assemblies (Aptek Williams), and global positioning
systems (GeoFocus -- which Williams Controls is selling). The
company also makes plastic parts (Premier Plastic Technologies,
which is being sold) and compressed natural gas conversion kits
for cars (NESC Williams). Major customers include Freightliner,
Navistar, and Volvo. Former CEO Thomas Itin owns 30% of Williams
Controls, which has put itself up for sale.

In its Form 10-Q filing for the quarter ended March 31, 2002,
the Company recorded a total shareholders' equity deficit of
about $15 million.


WORLDCOM INC: Wants to Honor & Pay Prepetition Sales & Use Taxes
----------------------------------------------------------------
Normally, Worldcom Inc., and its debtor-affiliates collect and
remit an assortment of taxes to various federal, state, and
local taxing authorities and pay various regulatory fees to
federal, state, and local regulatory authorities.

                      Sales and Use Taxes

Lori R. Fife, Esq., at Weil Gotshal & Manges LLP in New York,
relates that the Debtors sell international, interstate and
intrastate telecommunication services and equipment to their
customers.  In connection with the sales, the Debtors collect
and remit an assortment of sales, local gross receipts and
utility users taxes to the Taxing Authorities.  On a periodic
basis, Ms. Fife says, the Debtors remit the Sales Taxes
collected during the preceding month to the Taxing Authorities.  
Some Taxing Authorities require the Debtors to prepay the Sales
Taxes. During the second fiscal quarter of 2002, the Debtors
paid $69,200,000 per month for the Sales Taxes.

In addition, Ms. Fife continues, the Debtors also are
responsible for the payment of use taxes when they purchase any
tangible personal property, including switches, routers, and
other telecommunication-related equipment from vendors.  Use
Taxes are imposed on the Debtors by state and localities for the
use and storage of taxable items.  Without this nexus, Ms. Fife
explains, the vendor is not obligated to charge or remit sales
taxes for sales to parties within the state.  Nevertheless, the
Debtors are obligated to self assess and pay the Use Taxes.  The
Debtors remit the Use Taxes to the Taxing Authorities on a
monthly basis. During the second fiscal quarter of 2002, the
Debtors paid $1,503,746 per month for the Use Taxes.

Prior to the Petition Date, Ms. Fife reports that the Debtors
paid some but not all of the prepetition accrued and unpaid
amounts outstanding on account of Sales and Use Taxes.
Accordingly, the Debtors believe that there remain significant
prepetition Sales and Use Taxes owed.  Thus, the Debtors seek
the Court's authority to pay any amounts due or may be
subsequently determined upon audit to be owed prepetition.

                  Other Taxes and Regulatory Fees

In addition to Sales and Use Taxes, Ms. Fife says, the Debtors
pay a federal excise tax and state and local gross receipts tax
on most telecommunication services.  The Debtors pass along
certain of these expenses to their customers in the form of a
surcharge.  During the second fiscal quarter of 2002, the
Debtors paid $34,281,372 per month for Federal Excise Taxes and
$12,301,260 per month for Gross Receipts Taxes.

The Debtors also pay universal service fees to Regulatory
Authorities.  Ms. Fife explains that the Universal Service Fees
are assessed as a percentage of the Debtors' revenues derived
from the provision of telecommunication services within the
jurisdiction of the relevant Regulatory Authority and remitted
on a periodic basis depending on the payment requirements of the
various Regulatory Authorities.  According to Ms. Fife, the
Universal Service Fees are used to subsidize the high cost of
local telecommunications services and other governmental program
obligations like telecommunications relay services and provide
telecommunications services to schools, libraries and hospitals.
During the second fiscal quarter of 2002, the Debtors paid
$82,659,517 per month for Universal Service Fees.

Moreover, Ms. Fife relates, the Debtors pay certain franchise
fees.  The Franchise Fees are imposed on the Debtors by
localities for the use of their right-of-ways.  To recover the
costs of Franchise Fees, the Debtors surcharge their customers.
During the second fiscal quarter of 2002, the Debtors paid
$1,486,331 per month for the Franchise Fees.

Many municipal and county governments require the Debtors to
obtain a business license and pay corresponding business license
fees.  The requirements for a company to obtain a business
license and the manner that the business license fees are
computed vary greatly according to the local tax laws.  During
the second fiscal quarter of 2002, the Debtors paid $68,669 per
month for the Business License Fees.

According to Ms. Fife, the Debtors also pay numerous other
regulatory fees, including 9-1-1 taxes, telephone relay service
fees, deaf tax surcharges, poison control surcharges, escheat
obligations and other miscellaneous expenses imposed by various
governmental entities to the Taxing Authorities and the
Regulatory Authorities.

Prior to the Petition Date, the Debtors paid some but not all of
the prepetition accrued and unpaid amounts outstanding on
account of Regulatory Fees.  Accordingly, the Debtors believe
that there remains significant prepetition Regulatory Fees owed.  
The Debtors also seek Judge Gonzalez's permission to pay any
amounts due and might be subsequently determined upon audit to
be owed for periods prior to the Petition Date.

                        Method of Payment

Prior to the Petition Date, certain Taxing or Regulatory
Authorities were sent Checks or Electronic Transfers in respect
of obligations that may not have cleared the Debtors' banks or
other financial institutions as of the Petition Date.

By this motion, the Debtors seek the Court's authority to pay
all prepetition Sales and Use Taxes and Regulatory Fees owed to
the Taxing or Regulatory Authorities, including all Sales and
Use Taxes and Regulatory Fees subsequently determined upon audit
to be owed for periods prior to the Petition Date.

To the extent any Check or Electronic Transfer has not cleared
the Banks as of the Petition Date, the Debtors ask the Court to
authorize and direct the Banks, when requested by the Debtors in
their sole discretion, to receive, process, honor, and pay the
Checks or Electronic Transfers.

To the extent the Taxing or Regulatory Authorities have
otherwise not received payment for all prepetition Sales and Use
Taxes and Regulatory Fees owed, the Debtors seek the Court's
authority to issue replacement checks, or to provide for other
means of payment to the Taxing or Regulatory Authorities, to the
extent necessary to pay all outstanding Sales and Use Taxes and
Regulatory Fees owing for periods prior to the Petition Date.

Ms. Fife explains that Sales and Use, Federal Excise, and Gross
Receipts Taxes are afforded priority status under Section
507(a)(8) of the Bankruptcy Code.  As priority claims, Ms. Fife
says, Sales and Use, Gross Receipts and Federal Excise Taxes
must be paid in full before any general unsecured obligations of
a Debtor may be satisfied.  The Debtors assure the Court that
sufficient assets exist to pay all prepetition Sales and Use,
Gross Receipts and Federal Excise Taxes in full under any plan
or reorganization that may ultimately be proposed and confirmed
by this Court.  Accordingly, Ms. Fife says, the proposed relief
will only affect the timing of the payment of the prepetition
Sales and Use, Gross Receipts, and Federal Excise Taxes, and
therefore, will not prejudice the rights of general unsecured
creditors or other parties-in-interest.

Furthermore, Ms. Fife contends that payment of the Regulatory
Fees is critical to the Debtors' operations particularly because
each of the Debtors' businesses is subject to extensive state
and federal regulation.  "If the prepetition Regulatory Fees are
not paid, the Taxing or Regulatory Authorities could potentially
challenge the applicability of the automatic stay with
concomitant expense to the Debtors' estate.  Failing to pay all
prepetition Regulatory Fees harms the Debtors to the detriment
of the Debtors' estates, creditors, and all parties-in-interest
and potentially impairs the viability of Worldcom," Ms. Fife
says. (Worldcom Bankruptcy News, Issue No. 3; Bankruptcy
Creditors' Service, Inc., 609/392-0900)  


* DebtTraders' Real-Time Bond Pricing
-------------------------------------

Issuer               Coupon   Maturity  Bid - Ask  Weekly change
------               ------   --------  ---------  -------------
Crown Cork & Seal     7.125%  due 2002    97 - 98     +1.0
Freeport-McMoran      7.5%    due 2006    89 - 90.5   -1.0
Global Crossing Hldgs 9.5%    due 2009  1.15 - 2.5     +.37
K-Mart                9.375%  due 2006    31 - 33     -8.5
Levi Strauss          6.8%    due 2003  88.5 - 90     -0.5
Lucent Technologies   6.45%   due 2029    41 - 43       -6
MCI Worldcom          6.5%    due 2010    39 - 41     -6.5
Terra Industries      10.5%   due 2005    86 - 89      n/a
Westpoint Stevens     7.875%  due 2008    49 - 52.5    -10
Worldcom              7.5%    due 2011    14 - 15     -3.5
Xerox Corporation     8.0%    due 2027    43 - 45      n/a

Bond pricing, appearing in each Thursday's edition of the TCR,
is provided by DebtTraders in New York. DebtTraders is a
specialist in global high yield securities, providing clients
unparalleled services in the identification, assessment, and
sourcing of attractive high yield debt investments. For more
information on institutional services, contact Scott Johnson at
1-212-247-5300. To view our research and find out about private
client accounts, contact Peter Fitzpatrick at 1-212-247-3800.
Real-time pricing available at http://www.debttraders.com

                          *********

Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices
are obtained by TCR editors from a variety of outside sources
during the prior week we think are reliable.  Those sources may
not, however, be complete or accurate.  The Monday Bond Pricing
table is compiled on the Friday prior to publication.  Prices
reported are not intended to reflect actual trades.  Prices for
actual trades are probably different.  Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy
or sell any security of any kind.  It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.

A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com.

Bond pricing, appearing in each Thursday's edition of the TCR,
is provided by DebtTraders in New York. DebtTraders is a
specialist in global high yield securities, providing clients
unparalleled services in the identification, assessment, and
sourcing of attractive high yield debt investments. For more
information on institutional services, contact Scott Johnson at
1-212-247-5300. To view our research and find out about private
client accounts, contact Peter Fitzpatrick at 1-212-247-3800.
Real-time pricing available at http://www.debttraders.com/

Each Friday's edition of the TCR includes a review about a book
of interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.

For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.
                  
                          *********

S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter is a daily newsletter co-published by
Bankruptcy Creditors' Service, Inc., Trenton, NJ USA, and Beard
Group, Inc., Washington, DC USA. Yvonne L. Metzler, Bernadette
C. de Roda, Donnabel C. Salcedo, Ronald P. Villavelez and Peter
A. Chapman, Editors.

Copyright 2002.  All rights reserved.  ISSN: 1520-9474.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without
prior written permission of the publishers.  Information
contained herein is obtained from sources believed to be
reliable, but is not guaranteed.

The TCR subscription rate is $625 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each.  For subscription information, contact Christopher
Beard at 240/629-3300.

                *** End of Transmission ***